civil law review digests assoc

8/12/2019 Civil Law Review Digests Assoc

1/230

Civil Law Review 2 2013 - 2014

*WARNING & DISCLAIMER: This compilation contains case digests for Civil Law Review 2. Some of the

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ARAFAG HABANA JALAYAJAY Page 1

CIVIL LAW

REVIEW 2

Atty. VIVIANA MARTIN PAGUIRIGAN

School Year 2013 2014

ARAAG! "AR#N $.

%A$ANA! &AN#T% G.

&A'AYA&AY! $#TSY R.

()l*gat*o+, - o+tract, Sale, 'ea,e Part+er,h*/ Age+cy

re*t Tra+,act*o+, Tort, - aage,


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accurate, hence, reading the cases in full text is highly recommended. This is for personal use only and no

copyright infringement intended.

LIST OF CASES

SY 2013 2014

OBLIGATIONS & CONTRACTSARTICLES 1156- 1246

Macasaet vs. COA173 SCRA 352Phil. Export vs. Eusebio Cost.et al.!ul" 13# 2$$%&a'uili' vs. CA.2(( SCRA 7)Co*apia +eeral vs. Ara,a7 Phil. %55-eloso vs. otaosa.13 Phil. 7/0a"la vs. Sila' trasit73 Phil. 557ee vs. e +u,*a..1)7 SCRA 2770ar,a'a vs. CA..2() SCRA 1$5

PC vs. CA..1(1 SCRA 33%Picart vs. S*ith37 Phil )13Cosoli4ate4 0a vs. CA a4 ia,..Sept. 11# 2$$3Sch*i4t, trasport vs. trasport -eture..April 22# 2$$5Real vs. 0elo.!a. 2(# 2$$7Phil. Co**uicatios vs. +lobe &eleco*..Ma" 25# 2$$%S0&C vs. CA2%/ SCRA 2$(Macta Cebu 6tl Airport vs. &u4tu4.ov. 1%# 2$$)So' o vs. 8a9aii Phil. Co..%7 Phil )21Corte, vs. CA.!ul" 12# 2$$(+il vs. CA a4 8eirs o: MatulacSept. 12# 2$$3Spouses Ra"os vs. CA a4 Mira4a..!ul" 1%# 2$$%Cor4ero vs. .S. Maa'e*et evt.Oct. 31# 2$$(

Calero vs. Cario.1$7 Phil. 5%/&R0 vs. CA.177 SCRA 7))Phil. 0loo*i' Mills vs. CA a4 &R0Oct. 15# 2$$3Coutr" 0aers vs. CA..2$1 SCRA %5)Co*. Cre4it vs. CA..1(/ SCRA 1Pr"ce Corp. vs. Pa'cor.Ma" (# 2$$5Asiatrust evt 0a vs. Cocepts &ra4i'.!ue 2$# 2$$3!iso vs. CA1(% SCRA 33/o vs. ;!S Eco


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a'a &elephoe Co vs. CA23$ SCRA 351

&ras. Paci:ic 64. -s. CA235 SCRA %/%

Silahis vs. 6AC.1)$ SCRA 21

racia vs. CA.1(2 SCRA

753

0P6 vs. CA =127/@..!ue )# 2$$(

Citiba vs. Sabeiao.eb. 12# 2$$7Peoples 0a vs. S"vels.1(% SCRA 2%7

Bou' vs. CA1/( SCRA

2%7

PS0a vs. Spouses Maalac =12/[email protected] 2(# 2$$5

Astro Electroics vs. Phil. Export [email protected]. 23# 2$$3

Car*elcra:t vs. RC..1)( SCRA 3/3

Acol vs. PC60a =13$(@.!ul" 25# 2$$(

&iu vs. Platiu* Plas.eb. 2)# 2$$7

Avo vs. uaec. 2$#

2$$(

Piltel vs. &ecso..Ma" 7# 2$$%

P0 vs. Pa4illa =13$)@.1/( SCRA 537

;C 8ol4i's vs. CA =1311@32/ SCRA (((

&aa" Recreatio vs. austo [email protected] 12# 2$$5

lea4o vs. lea4o.March %# 2$$/

+ilchrist vs. Cu44" =131%@2/ Phil. 5%2

Motecillo vs. Re"es =1317@!ul" 2(# 2$$2

racisco vs. 8errera =131)@.ov. 21# 2$$2

Coroel vs. Costatio [email protected]. 7# 2$$3

au4icio vs. Arias =131/@..%3 Phil. 27$

-illaueva vs. CA =131/@..2%% SCRA 3/5

A4el:a vs. CA =132%@2%$ SCRA 5(5

Serra vs. CA22/ SCRA(1

Malbarosa vs. CA =132%@..April 3$# 2$$3

-4a. e Ape vs. CA [email protected] 15# 2$$5

Ma"or vs. 0ele.!ue 3# 2$$%

ARTICLES 1338 1428

0autista vs. CA..Au'. 11# 2$$%

au4e 8erae, vs. elos A'eles27 SCRA 127(

Clau4el vs. CA1// SCRA 113

0er*a Me*orial vs. Che'..Ma" (# 2$$5

+u,*a 0ocali' vs. 0oevie.2$( SCRA (()

Euatorial Realt" vs. Ma":air &heater..2(% SCRA %)3

Rivera vs. el Rosario =13)1@..!a. 15# 2$$%

&aa" Recreatio vs. austoApril 12# 2$$5

Republic vs. avi4 =13)[email protected]'. 1(# 2$$%

Air race vs. CA =separate [email protected]%5 SCRA %)5

Chia 0ai' vs. CA =13)[email protected] SCRA 37)

Ca49alla4er vs. S*ith 0ell &ra4i'.7 Phil. %(1



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-4a. e 0ucio vs. Estate o: 4e eo.15( SCRA 353

Asia Pro4uctios vs. Pao..2$5 SCRA

Averia vs. Averia =1%$3@Au'. 13# 2$$%

Cle*eo vs. obre'at =1%$3@Sept. /# 2$$%

ir*e vs. 0ual EterprisesOct. 23# 2$$3Su*ipat vs. 0a'a et al =1%$/@Au'. 13# 2$$%

8ulst vs. PR 0uil4ers...Sept. 3# 2$$7

8ulst vs. PR 0uil4ersSept. 25# 2$$)

+ocha vs. 8eirs o: 0aba.Au'. 1/# 2$$3

oril4a vs. R&C..1(/ SCRA

351

Suta" vs. CA.251 SCRA

%3$

&eDa Mareti' vs. CA..1%) SCRA 3%7

0P vs. A4il..1(1 SCRA

3$7

ARTICLES 1429 1519

Roblett vs. CA.2(( SCRA

71

0ucto vs. +abar..55 SCRA %//

Olaco vs. CA.22$ SCRA

(5(

Chiao Si' &a vs. CA22) SCRA 75

+icao vs. +e'ato157 SCRA

1%1

Cru, vs. era4o.ec. /# 2$$5

Pi'ol vs. CA.22( SCRA

11)

Portu'al vs. CA15/ SCRA

17/

Sache, vs. Ri'os =1%7/@.%5 SCRA 3()

Eulo'io vs. ApelesSept. 2$#

2$$/

Rosario vs. PC6 =1%)%@ov. 11# 2$$5

Pa'talua vs. -4a. e Ma,ao Sept. 13# 2$$7

oril4a vs. R&C =1%/1@!a. 2%# 1/)/Ola'uer vs. ocsi =1%/[email protected]. 12# 2$$7

oris vs. CA =1%/(@..1/3 SCRA

(/%

+aisao vs. 6CA =15$%@.!ue )# 2$$(

a9"ers Publishi' vs. &abora =15$%@..13 SCRA (/%

ura vs. 6AC.13) SCRA

%)/

A,ar vs. Bap4a'o13 SCRA %)(



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ARICLES 1520 1610

Ra4io9ealth vs. Palileo =15%%@1/7 SCRA 2%5

u'ui4 vs. CA..171 SCRA

213

&orreca*po vs. Ali4o'a =15%%@.eb. 2)# 2$$7

+urrea vs. Suplico.April 2(#2$$(

Moles vs. 6AC1(/ SCRA

777

-illostas vs. CA.21$ SCRA

%/1

Spouses " vs. Arri,a =15%)#5)#5/@..Au'. 17# 2$$(

e +u,*a vs. &o"ota =15((@..ov. 2/# 2$$(+oo4"ear vs. S" =15((@.ov. /# 2$$5

-illarica vs. CA =1($1@2( SCRA 1)/

eal vs. CA.155 SCRA

3/5

0uce vs. CA157 SCRA

33$

Satos vs. CA17/ SCRA

3(3

A4orable vs. 6acala1$3 Phil %)1

0a4o' vs. Austria.31 Phil. %7$

0a"ue vs. boloro..1%3 SCRA

%12" vs. CA.2%(

SCRA 7$3

-er4a4 vs. CA..25( SCRA

5/3

LEASE

0P6 vs. o*i'o.ov. 27#

2$$(

apil vs. &C =1(5%@.Sept. 2(# 2$$(Parilla vs. Pilar =1(7)@.ov. 3$# 2$$(

+o ;i' vs. +eroi*o.)1 Phil. %%5

CMS 6vest*et vs. 6AC13/ SCRA 75

er*i vs. CA...1/( SCRA

725

Matruste vs. CA =1(7)@17/ SCRA

137

Ro*a Catholic vs. CA2(/ SCRA

1%7

ARAFAG HABANA JALAYAJAY Page


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PARTNERSHIP

A'a4 vs. *abato23 SCRA

1223

Obillos vs. C6R =17(/@.13/ SCRA

%3(

Pascual vs. C6R.1(( SCRA

5($

itoDua vs. itoDua =1771


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Ester Shippi' ies vs. CA.23% SCRA 7)

lore4o vs. CA..2(5 SCRA

(7)

P0 vs. CA.23) SCRA

2$

Si'a


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0P vs. RC23( SCRA

117

TORTS AND DAAGES

Pci easi' vs. CP0 =127(@!ul" %# 2$$)

Ca4iete vs. Macas =217/@..ov. 1%# 2$$)

Capili vs. Car4aa..ov. 2# 2$$(

Pro:essioal Services 6c. vs. A'aa.!a. 31# 2$$7

+la Peoples u*ber vs. 6AC173 SCRA %(5

A:rica vs. Caltex1( SCRA

%%)

ula" vs. CA.2%3

SCRA 22$

Custo4io vs. Ca..253 SCRA

2)3

ibi vs. 6AC.21%

SCRA 1(Coca Cola vs. CA227

SCRA 2/3

Cit" o: Maila vs. &eotico..22 SCRA 2(7

+uilatco vs. Cit" o: a'upa171 SCRA 3)3

+otesco vs. Chatto..21$ SCRA

1/

MM&C vs. CA2/)

SCRA %/5

+elu, vs. CA..!ul" 2$#

1/(1

lores vs. Pie4a =22$(@..ov. 1%#

2$$)

-illaueva vs. CP0327 SCRA

3/1

6hel4er vs. CA..122 SCRA

577

&a vs. CA..23/

SCRA 311

+eral4e, vs. CA..23$

SCRA 321

People vs. Pra4es.23/ SCRA

%11

RCP6 vs. CA1/5SCRA 1%7

-4a. e Me4ia vs. Crescecia..// Phil. 5$7



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OBLIGATIONS &CONTRACTS

!LA"IO # ACASAET & ASSOCIATES$ INC% "%COA '()

PHILIPPINE TOURIS AUTHORITY+.R. o. )37%) Ma" 12# 1/)/

!ACTS*O 15 Septe*ber 1/77 respo4et Philippie

&ouris* Authorit" =P&A@ etere4 ito a Cotract :orGProDect esi' a4 Maa'e*et Services :or the4evelop*et o: the propose4 Ha*boa'a +ol: a4Coutr" ClubI i Ha*boa'a Cit" 9ith petitioerco*pa"# but ori'iall" 9ith lavio ; Macasaet aloe.

4er Article 6- o: sai4 Cotract# petitioer 9as to beetitle4 to seve =7J@ o: the Gactual costructio cost.G

Pursuat to the :ore'oi' Sche4ule# the P&A*a4e perio4ic pa"*ets o: the stipulate4 pro:essioal:ees to petitioer. A4# upo co*pletio o: the proDect#P&A pai4 petitioers 9hat it perceive4 to be the balaceo: the latterKs pro:essioal :ees.

6t ture4 out# ho9ever# that a:ter the proDect 9asco*plete4# P&A pai4 Supra Costructio Co*pa"# the*ai cotractor# the a44itioal su* o: P3#1%)#1/).2(represeti' the escalatio cost o: the cotract price 4ue

to the icrease i the price o: costructio *aterials.

po leari' o: the price escalatio# petitioerreueste4 pa"*et o: P21/#3$2.%7 a44itioalpro:essioal :ee represeti' seve =7J@ percet o:P3#1%)#1/).2(.O 3 !ul" 1/)5 P&A 4eie4 pa"*et o the 'rou4 thatGthe subDect price escalatio re:erre4 to icrease4 cost o:costructio *aterials a4 4i4 ot etail a44itioal 9oro the part o: petitioer as to etitle it to a44itioalco*pesatio u4er Article -6 o: the cotract.G

ISSUE* Fhether or ot the price escalatio shoul4 beiclu4e4 i the G:ial actual proDect cost.G

HELD* &hat a escalatio clause 9as ot speci:icall"provi4e4 :or i the Cotract is o: o *o*et either :or it*a" be cosi4ere4 as alrea4" Gbuilt


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PHILIPPINE E+PORT AND !OREIGN LOANGUARANTEE CORPORATION "% "%P% EUSEBIO

CONSTRUCTION$ INC%G%R% N,% 140047 ./ 13$ 2004

!ACTS*

O 11 !ue 1/)1# SO0 a4 the Doit veture-PEC6 a4 AD"al execute4 the service cotract :or thecostructio o: the 6stitute o: Ph"sical &herap" ?Me4ical Rehabilitatio Ceter# Phase 66# i 0a'h4a4#6ra# 9herei the Doit veture cotractor u4ertoo toco*plete the ProDect 9ithi a perio4 o: 5%7 4a"s or 1)*oths. 4er the Cotract# the !oit -eture 9oul4suppl" *apo9er a4 *aterials# a4 SO0 9oul4 re:u4to the :or*er 25J o: the proDect cost i 6rai iar a4the 75J i S 4ollars at the excha'e rate o: 1 iar to3.37777 S ollars.

&he costructio# 9hich 9as suppose4 to start

o 2 !ue 1/)1# co**ece4 ol" o the last 9ee o:Au'ust 1/)1. 0ecause o: this 4ela" a4 the slo9pro'ress o: the costructio 9or 4ue to so*e setbacsa4 4i::iculties# the ProDect 9as ot co*plete4 o 15ove*ber 1/)2 as sche4ule4. 0ut i October 1/)2#upo :oreseei' the i*possibilit" o: *eeti' the 4ea4liea4 upo the reuest o: Al Ahli 0a# the Doit veturecotractor 9ore4 :or the ree9al or extesio o: thePer:or*ace 0o4 a4 A4vace Pa"*et +uaratee.

&he suret" bo4 9as also exte4e4 :or aotherperio4 o: oe "ear# :ro* 12 Ma" 1/)2 to 12 Ma"1/)3.1) &he Per:or*ace 0o4 9as :urther exte4e4t9elve ti*es up to ) ece*ber 1/)(# 9hile the A4vacePa"*et +uaratee 9as exte4e4 three ti*es *ore upto 2% Ma" 1/)% 9he the latter 9as cacelle4 a:ter :ullre:u4 or rei*burse*et b" the Doit veture cotractor.&he suret" bo4 9as lie9ise exte4e4 to ) Ma" 1/)7.

As o: March 1/)(# the status o: the ProDect 9as51J acco*plishe4# *eai' the structures 9ere alrea4":iishe4. &he re*aii' %7J cosiste4 i electro 5$$pesos o the 3$th o: !ue# 1/$1# a4 the re*ai4er atthe rate o: 1$$ pesos a *oth# pa"able o the 3$th 4a"o: each *oth# util the etire )#$$$ pesos 9as pai4.&he 4e:e4at pai4 %$$ pesos a4 o *ore.

&he plaiti:: brou'ht this actio i the court to:oreclose a *ort'a'e :or )#$$$ pesos upo certai la4i the Provice o: e"te. A 4e*urrer to the co*plait

9as overrule4# but to the or4er overruli' it the4e:e4at 4i4 ot except. &he 4e:e4at as9ere4#

alle'i' that the 4ocu*et# the basis o: the plaiti::sclai*# 9as execute4 throu'h error o his part a4throu'h :rau4 o the part o: the plaiti::. A trial 9as ha4a4 Du4'*et 9as etere4 :or the plaiti:: as pra"e4 :ori its co*plait. &he 4e:e4at *ove4 :or a e9 trial othe 'rou4 that the 4ecisio 9as ot Dusti:ie4 b" theevi4ece# this *otio 9as 4eie4# to its 4eial the4e:e4at accepte4# a4 he has brou'ht the case to theSC :or revie9.

ISSUE*Fhether the 4ebtor is to be cosi4ere4 to be i

4e:ault.

HELD*&his suit 9as co**ece4 o the 12th 4a" o:

!ue# 1/$3. &here 9as o provisio i the cotract b"9hich# upo :ailure to pa" oe istall*et o: the 4ebt#the 9hole 4ebt shoul4 thereupo beco*e at ocepa"able. Fe are o: the opiio that the obli'atio ca bee:orce4 i this actio :or ol" the a*out 4ue a4pa"able o the 12th 4a" o: !ue# 1/$3.

&he court belo9 'ave o cre4it :or the pa"*eto: %$$ pesos a4*itte4 b" the co*plait to have bee

receive4 b" the plaiti::. 6t is allo9e4 iterest upo theetire 4ebt :ro* the 1st 4a" o: !ul"# 1/$1. &he cotract4oes ot provi4e :or the pa"*et o: a" iterest. &hereis o provisio i it 4eclari' expressl" that the :ailure topa" 9he 4ue shoul4 put the 4ebtor i 4e:ault. &here

9as there:ore o 4e:ault 9hich 9oul4 *ae hi* liable :oriterest util a 4e*a4 9as *a4e. =Civil Co4e# art. 11$$LMaresa# Co*. o Civil Co4e# vol )# p. 5(.@

ARIANO "ELOSO$ ET AL% "S% ANICETA!ONTANOSA



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G% R% N,% 4874% ' 2$ 1909

!ACTS*Plaiti::s Mariao# a*iaa# a4 Melchor

-eloso are the sole la9:ul heirs o: +avio -eloso a40ueavetura -eloso# their :ather a4 brother#respectivel"L 9hile e:e4ats are Aiceta otaosa#

as 9i4o9 o: Roberto AcaDas# a4 loretia# eoa#Maria# !ua# Ro*ual4o# -iceta# a4 elix# all o: thesura*e o: AcaDas# the la9:ul chil4re o: the 4ecease4Roberto# a4 Este:aia otaosa# *other a4 le'al'uar4ia o: the *ior !ose AcaDas.

&hat at the 4eath o: +avio -eloso# RobertoAcaDas o9e4 hi* the su* o: 5#$(5 pesos 9hich he ha4borro9e4 prior to the "ear 1))1L i the apportio*et o:the estate# this 4ebt o: 5#$(5 pesos 9et to0ueavetura -eloso as his portioL that i the "ear1))2# Roberto AcaDas# a:ter havi' aco9le4'e4 thetras:er o: his i4ebte4ess b" iheritace to

0ueavetura -eloso# cotiue4 to receive su*s o:*oe" :ro* the latter o: the sa*e co4itios# that is# asloas# a4 bou4 hi*sel: to *ae aual pa"*ets isu'ar.

O the 11th o: October# 1))3# the 4ebt o:Roberto AcaDas a*oute4 to 1$#%%/. 1) pesos 9hichrose to 1%#%3/. %$ pesos# 9hich su*# ho9ever# 9asre4uce4 to 12#3(5. 2$ pesos b" the pa"*et o: 2#$7%.2$ pesos o accout. p to the "ear 1)/3 thee:e4ats *a4e pa"*ets a*outi' to (%2. 27 pesos

9hich re4uce4 the a*out o9i' to 11#722. %3 pesos.

O the 4eath o: 0ueavetura -eloso# thee:e4ats# as his sole a4 la9:ul heirs# iherite4# a4that sa*e "ear 4ivi4e4 bet9ee the* all his propert"

9ith the exceptio o: the above


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SO!RONIO T% BAYLA "% SILANG TRA!!IC CO%$INC%$

G%R% N,% L-48195 '() 48196 ' 1$ 1942

!ACTS*Petitioers istitute4 a actio i the C6 o:

Cavite a'aist the respo4et Sila' &ra::ic Co.# 6c. to

recover certai su*s o: *oe" 9hich the" ha4 pai4severall" to the corporatio o accout o: shares o:stoc the" i4ivi4uall" a'ree4 to tae a4 pa" :or u4ercertai speci:ie4 ter*s a4 co4itios that# subscriber:urther a'rees that i: he :ails to pa" a" o: sai4istall*et 9he 4ue# or to per:or* a" o: the a:oresai4co4itios# or i: sai4 shares shall be attache4 or levie4upo b" cre4itors o: the sai4 subscriber# the the sai4shares are to revert to the seller a4 the pa"*etsalrea4" *a4e are to be :or:eite4 i :avor o: sai4 seller#a4 the latter *a" the tae possessio# 9ithoutresorti' to court procee4i's.I

&he respo4et corporatio set up the 4e:esethat the subscribe4 shares o: stoc o: petitioers ha4alrea4" auto*aticall" reverte4 to the 4e:e4at# a4 theistall*ets pai4 b" the* ha4 alrea4" bee :or:eite4.

R&C absolve4 the 4e:e4at :ro* the co*plaita4 4eclare4 cacele4 =:or:eite4@ i :avor o: the4e:e4at the shares o: stoc i uestio. 6t hel4 that theresolutio o: Au'ust 1# 1/37# 9as ull a4 voi4# citi'-elasco vs. Poi,at =37 Phil.# )$2@ that Ga corporatio haso le'al capacit" to release a ori'ial subscriber to itscapital stoc :ro* the obli'atio to pa" :or sharesL a4a" a'ree*et to this e::ect is ivali4GCA *o4i:ie4 o: the R&C 4ecisio. 6t hel4> that part o: the

Du4'*et 4is*issi' plaiti::Ks co*plait is a::ir*e4# butthat part thereo: 4eclari' their subscriptio cacele4 isreverse4. e:e4at is 4irecte4 to 'rat plaiti::s 3$4a"s a:ter :ial Du4'*et 9ithi 9hich to pa" the arrearso their subscriptio.

Petitioers isist that the" have the ri'ht torecover the a*outs it pai4# 9hile the respo4et a4cross


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ALE+ G% LEE$ "% HON% SAL"ADOR P% DE GUAN$R%

G%R% N,% 90926 ./ 6$ 1990

!ACTS*O ove*ber )# 1/)3# petitioer Alex 0. ee

purchase4 :ro* respo4et Motor Cars throu'h its:reelace a'et# oe =1@ uit &o"ota Corolla i:tbac#

1/)3 *o4el# 9ith the uote4 price o: P1%/#7$$.$$ plus*iscellaeous expeses o: P1$#$33.$$. O the sa*e4ate# petitioer ee as custo*er# si'e4 the vehiclesales or4er. &he 4eliver" o: the subDect vehicle 9as

9ithi the *oth o: ove*ber# 1/)3.

6 vie9 o: such or4er# petitioer ee 4eposite4the a*out o: P1#$$$.$$ o ove*ber 1$# 1/)3 asreuire4 i the a:oresai4 price uotatio. &hereupo# oece*ber 15# 1/)3# petitioerKs cousel# Att". oroteoA. a4al# 9rote Mr. icolas O. CarraceDa# !r.# Executive-ice


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G%R% N,% 115129% !.' 12$ 1997

!ACTS*

&he petitioers 9i:e 9as su::eri' :ro* a4ebilitati' ail*et a4 9ith :ore9ari' o: heri*pe4i' 4eath# she expresse4 her 9ish to be lai4 to

rest be:ore Christ*as 4a" to spare her :a*il" o: the lo'vi'ils as it 9as al*ost Christ*as. A:ter his 9i:e passe4a9a"# petitioer bou'ht *aterials :ro* herei privaterespo4ets :or the costructio o: her iche. Privaterespo4ets ho9ever :aile4 to 4eliver o a'ree4 ti*ea4 4ate 4espite repeate4 :ollo9


19/230


EC6 etere4 ito a cotract 9ith AFASA tou4ertae a costructio o: a tuel :ro* 6po a* to0icti iclu4i' all *aterials# euip*et a4 labor :or thesai4 costructio :or )$$ 4a"s. &he proDect ivolve4 2phases. &he :irst ivolves tuel 9ors a4 the seco4cosists o: out9ors at both e4s o: the tuel.

As soo as EC6 :iishe4 the tuel 9ors i0icti# it tras:erre4 all its euip*ets to 6po a* to :iishthe seco4 phase o: the proDect.

&he recor4 sho9s that o ove*ber %#1/(7#t"phoo Fel*i' hit Cetral u,o# passi' throu'h4e:e4ats =PC@ A'at 8"4ro


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Exe*plar" a*a'es

o. As to the uestio o: exe*plar" 4a*a'es#9e sustai the appellate court i eli*iati' the sa*esice it :ou4 that there 9as o ba4 :aith o the part o:PC a4 that either ca the latters e'li'ece becosi4ere4 'ross. 6 ee 8ua io' Electrical

Euip*et Corp. v. Re"es# =1%5 SCRA 713# 71/@ 9erule4>

either *a" private respo4et recoverexe*plar" 4a*a'es sice he is ot etitle4 to *oralor co*pesator" 4a*a'es# a4 a'ai because thepetitioer is ot sho9 to have acte4 i a 9ato#:rau4ulet# recless or oppressive *aer =Art. 223%#Civil Co4eL Butu v. Maila Electric Co.# 2 SCRA 377Lracisco v. +over*et Service 6surace S"ste*#7 SCRA 577L +utierre, v. -ille'as# ) SCRA 527L Airrace v. Carrascoso# 1) SCRA 155L Pa Paci:ic=Phil.@ v. Phil. A4vertisi' Corp.# 23 SCRA /77LMarcha v. Me4o,a# 2% SCRA )))@.

AADO PICART "S% !RAN# SITH$ R%$G%R% N,% L-12219 ' 15$ 1918

!ACTS*

Plaiti:: A*a4o Picart 9as ri4i' o his po" othe Carlata 0ri4'e i Sa era4o# a io 9he the



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4e:e4at# ri4i' o his car# approache4. e:e4atble9 his hor to 'ive 9ari'. Plaiti:: *ove4 the horseto the ri'ht istea4 o: *ovi' to the le:t# reasoi' thathe ha4 o su::iciet ti*e to *ove to the ri'ht 4irectio.e:e4at cotiue4 to approach# a4 9he he ha4'otte uite ear# he uicl" ture4 to the le:t. &he horse

9as :ri'htee4 that it ture4 his bo4" across the bri4'e.8is li*b 9as broe a4 the ri4er 9as thro9 o:: a4 'ot

iDure4. &he horse 4ie4. A actio :or 4a*a'es 9as :ile4a'aist the 4e:e4at.

ISSUE*

Fhether or ot the 4e:e4at i *aeuveri'his car i the *aer above 4escribe4 9as 'uilt" o:e'li'ece such as 'ives rise to a civil obli'atio torepair the 4a*a'e 4oe

HELD*

As the 4e:e4at starte4 across the bri4'e# heha4 the ri'ht to assu*e that the horse a4 ri4er 9oul4pass over to the proper si4eL but as he *ove4 to9ar4the ceter o: the bri4'e it 9as 4e*ostrate4 to his e"esthat this 9oul4 ot be 4oeL a4 he *ust i a *o*ethave perceive4 that it 9as too late :or the horse to cross

9ith sa:et" i :rot o: the *ovi' vehicle. 6 the ature o:thi's this cha'e o: situatio occurre4 9hile theauto*obile 9as "et so*e 4istace a9a"L a4 :ro* this*o*et it 9as o lo'er 9ithi the po9er o: the plaiti::to escape bei' ru 4o9 b" 'oi' to a place o: 'reatersa:et". &he cotrol o: the situatio ha4 the passe4etirel" to the 4e:e4at.

&he test b" 9hich to 4eter*ie the existece o:e'li'ece i a particular case *a" be state4 as :ollo9s>i4 the 4e:e4at i 4oi' the alle'e4 e'li'et act usethat reasoable care a4 cautio 9hich a or4iaril"pru4et perso 9oul4 have use4 i the sa*e situatio6: ot# the he is 'uilt" o: e'li'ece. Co4uct is sai4 tobe e'li'et 9he a pru4et *a i the positio o: thetort:easor 9oul4 have :oresee that a e::ect har*:ul toaother 9as su::icietl" probable to 9arrat his:ore'oi' the co4uct or 'uar4i' a'aist itscoseueces.

6t 'oes 9ithout sa"i' that the plaiti:: hi*sel:9as ot :ree :ro* :ault# :or he 9as 'uilt" o: atece4ete'li'ece i plati' hi*sel: o the 9ro' si4e o: theroa4. 0ut as 9e have alrea4" state4# the 4e:e4at 9asalso e'li'etL a4 i such case the proble* al9a"s isto 4iscover 9hich a'et is i**e4iatel" a4 4irectl"resposible. 6t 9ill be ote4 that the e'li'et acts o: thet9o parties 9ere ot cote*poraeous# sice the

e'li'ece o: the 4e:e4at succee4e4 the e'li'eceo: the plaiti:: b" a appreciable iterval. 4er thesecircu*staces the la9 is that the perso 9ho has thelast :air chace to avoi4 the i*pe4i' har* a4 :ails to4o so is char'eable 9ith the coseueces# 9ithoure:erece to the prior e'li'ece o: the other part".

THE CONSOLIDATED BAN# '() TRUSTCORPORATION "S% CA '() L%C% DIA & COPANY

G%R% N,% 138569% S 11$ 2003

!ACTS*

Private respo4et .C. ia, istructe4 hise*plo"ee# Calapre# to 4eposit i his savi's accout ipetitioer ba. Calapre le:t the passboo o: .C. ia, to



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O Septe*ber 1//1# S&CO Pte. t4 Si'aporeshippe4 3%5 hot rolle4 steel sheets i coil :ro* the porto: Russia. &he car'oes 9hich 9ere to be 4ischar'e4 iMaila 9ere isure4 9ith 64ustrial 6surace Co*pa".&he cosi'ee ittle +iat Steel Pipe e'a'e4 theservices o: petitioer Sch*i4t &rasport to secure thereuisite clearaces a4 4eliver the car'oes to Caita

Ri,al.

Respo4et &rasport -eture o the otherha4 9as e'a'e4 b" Sch*i4t to to9 the bar'ecotaii' the car'oes to the ship"ar4. &he arrastreoperator 9as able to uloa4 ol" 37 out o: the 3%5 coils4ue to icle*et 9eather co4itios. &he bar'ecotaii' the 37 coils pitche4 a4 rolle4 9ith the 9avesa4 evetuall" capsi,e4. Cosi'ee ittle +iat the:ile4 a isurace clai* a'aist 64ustrial 6surace

9hich i tur :ile4 a co*plait a'aist Sch*i4t torecover the a*out it pai4 to ittle +iat.

&he &rial Court hol4s Sch*i4t &rasport a4&rasport -eture soli4aril" liable :or the a*out. &he4ecisio 9as a::ir*e4 b" the CA a4 the 4e:ese o::ortuitous evet 9as 4iscre4ite4. 8ece# Sch*i4t&rasport :ile4 this petitio be:ore the SC a'aist &-6#64ustrial 6surace a4 the 0lac Sea.

ISSUE*

Fhether or ot the loss o: the car'oes 9as 4ueto a :ortuitous evet# hece# petitioers shoul4 ot behel4 liable

HELD*

O. &he Supre*e Court hel4 that 9he a:ortuitous evet occurs# Article 117% o: the Civil Co4eabsolves a" part" :ro* a" a4 all liabilit" arisi'there:ro*>

AR&. 117%. Except i cases expressl" speci:ie4b" the la9# or 9he it is other9ise 4eclare4 b"stipulatio# or 9he the ature o: the obli'atio reuiresthe assu*ptio o: ris# o perso shall be resposible

:or those evets 9hich coul4 ot be :oresee# or 9hichthou'h :oresee# 9ere ievitable.

6 or4er# to be cosi4ere4 a :ortuitous evet#ho9ever# =1@ the cause o: the u:oresee a4uexpecte4 occurrece# or the :ailure o: the 4ebtor toco*pl" 9ith his

obli'atio# *ust be i4epe4et o: hu*a 9illL =2@ i*ust be i*possible to :oresee the evet 9hich costitutethe caso :ortuito# or i: it ca be :oresee it *ust bei*possible to avoi4L =3@ the occurrece *ust be such asto re4er it i*possible :or the 4ebtor to :ul:ill hisobli'atio i a" *aerL a4 =%@ the obli'or *ust be:ree :ro* a" participatio i the a''ravatio o: theiDur" resulti' to the cre4itor.

&he priciple e*bo4ie4 i the act o: +o44octrie strictl" reuires that the act *ust be occasioe4solel" b" the violece o: ature. 8u*a itervetio is tobe exclu4e4 :ro* creati' or eteri' ito the cause o:the *ischie:. Fhe the e::ect is :ou4 to be i part theresult o: the participatio o: *a# 9hether 4ue to hisactive itervetio or e'lect or :ailure to act# the 9holeoccurrece is the hu*ai,e4 a4 re*ove4 :ro* therules applicable to the acts o: +o4.

&he appellate court# i a::ir*i' the :i4i' o:the trial court that hu*a itervetio i the :or* o

cotributor" e'li'ece b" all the 4e:e4ats resulte4 tothe loss o: the car'oes# hel4 that uloa4i' outsi4e thebrea9ater# istea4 o: isi4e the brea9ater# 9hile astor* si'al 9as up costitutes e'li'ece. 6t thuscoclu4e4 that the proxi*ate cause o: the loss 9as0lac Seas e'li'ece i 4eci4i' to uloa4 thecar'oes at a usa:e place a4 9hile a t"phoo 9asapproachi'. &he loss thus :alls outsi4e the Gact o: +o44octrie.G

REAL "S% BELO'(.' 26$ 2007



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!ACTS*

Petitioer -ir'iia Real a4 respo4etSesie4o 0elo both o9e4 a4 operate4 a :ast:oo4stall i the :oo4 court ceter o: PF. A :ire broe out atthe petitioers stall 9hich sprea4 a4 'utte4 other stallsi the area iclu4i' that o: the respo4ets.Respo4et 4e*a4e4 pa"*et :ro* the petitioer but

the latter re:use4. 8ece# a case :or 4a*a'es 9as :ile4be:ore the M&C.

Respo4et alle'e4 that petitioer :aile4 toexercise 4ue 4ili'ece i the upeep a4 *aiteaceo: her cooi' euip*ets# as 9ell as the selectio a4supervisio o: her e*plo"eesL that petitioerKse'li'ece 9as the proxi*ate cause o: the :ire that'utte4 the :ast:oo4 stalls. &he petitioer o the otherha4 4eie4 liabilit" o the 'rou4s that the :ire 9as a:ortuitous evet a4 that she exercise4 4ue 4ili'ece ithe selectio a4 supervisio o: her e*plo"ees. M&C

re4ere4 Du4'*et i :avour o: respo4et 0elo a4 9asa::ir*e4 b" the R&C a4 CA upo appeal.

ISSUE*

Fhether or ot the :ire that broe out :ro*petitioers stall is a :ortuitous evet

HELD*

O. !urispru4ece 4e:ies the ele*ets o: aG:ortuitous evetG as :ollo9s> =a@ the cause o: theu:oresee a4 uexpecte4 occurrece *ust bei4epe4et o: hu*a 9illL =b@ it *ust be i*possible to:oresee the evet 9hich costitutes the caso :ortuito# ori: it ca be :oresee# it *ust be i*possible to avoi4L =c@the occurrece *ust be such as to re4er it i*possible:or the 4ebtor to :ul:ill his obli'atio i a or*al *aerLa4 =4@ the obli'or *ust be :ree :ro* a" participatio ithe a''ravatio o: the iDur" resulti' to the cre4itor.

Article 117% o: the Civil Co4e provi4es that operso shall be resposible :or a :ortuitous evet 9hichcoul4 ot be :oresee# or 9hich# thou'h :oresee# 9asievitable. 6 other 9or4s# there *ust be a etireexclusio o: hu*a a'ec" :ro* the cause o: iDur" orloss.

6t is establishe4 b" evi4ece that the :ireori'iate4 :ro* leai' :u*es :ro* the P+ stove a4

ta istalle4 at petitioerKs :ast:oo4 stall a4 hee*plo"ees :aile4 to prevet the :ire :ro* sprea4i' a44estro"i' the other :ast:oo4 stalls# iclu4i'respo4etKs :ast:oo4 stall. Such circu*staces 4o otsupport petitioerKs theor" o: :ortuitous evet.

PHILIPPINE COUNICATIONS "S% GLOBE' 25$ 2004

!ACTS*



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O Ma" 7# 1//1 Philco*sat +lobe etere4ito a a'ree*et 9hereb" Philco*sat obli'e4 itsel: toestablish# operate provi4e a 60S sta4ar4 0 earthstatio :or the exclusive use o: S 4e:eseco**uicatios A'ec" =SCA@. &he ter* 9as :or ($*oths or 5 "rs 6 tur# +lobe pro*ise4 to pa"Philco*sat *othl" retals.

At the executio o: the a'ree*et# both partiese9 that *ilitar" 0ases A'ree*et 9as to expire i1//1. Subseuetl"# Philco*sat istalle4 the earthstatio SCA *a4e use o: the sa*e.

&he seate passe4 a resolutio expressi' its4ecisio ot to cocur i the rati:icatio o: the treat" o::rie4ship. So the RP


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"S% COURT O! APPEALS '() YSAEL C% !ERRERO=, 11$ 1995

!ACTS*

S0&C a4 Mahit cotracte4 errer to costructi 2$$ 4a"s a buil4i' i cosi4eratio o: 1#7($#$$$.$$.

errer 9as able to :iish the costructio o: the buil4i'9ithi the prescribe4 ti*e# but icurre4 a44itioalexpeses o: about 3$$#$$$.$$ o top o: the ori'ial cost4ue to 4rastic icreases i costructio *aterials. errer*a4e ti*el" 4e*a4s :or pa"*et o: the icrease4 cost#a4 S0&C a4 a represetative o: a architectural :ir*cosulte4 b" S0&C veri:ie4 errers clai*s :or a44itioalcost. A reco**e4atio 9as the *a4e to settle theclai* :or 2$$#$$$.$$ but S0&C 4i4 ot pa" the a*out#a4 istea4 4eie4 a" liabilit" :or the a44itioal cost.errer the :ile4 a clai* :or breach o: cotract 9ith4a*a'es i the R&C# 9hich rule4 i :avor o: errer#Court o: Appeals a::ir*e4 the 4ecisio.

ISSUE*

Fhether or ot S0&C shoul4 be hel4 liable :orthe icrease i the cost o: costructio 4ue to the 4rasticicrease i the cost o: *aterials

HELD*

BES. 4er Art 11)2 o: the CC# a co4itioalobli'atio shall be voi4 i: its :ul:ill*et 4epe4s upo thesole 9ill o: the 4ebtor. 4er Art 6V o: the buil4i'cotract it allo9s :or the a4Dust*et o: the cotract priceupo *utual a'ree*et o: the parties.

6t is the absece o: this *utual a'ree*et thatthe ba is usi' to support its cotetio that it is otliable :or the icrease4 cost# a4 i e::ect this is aobli'atio 4epe4et o S0&Cs sole 9ill# sice itscoset is reuire4 :or the recover" o: the icrease4 cost

to be allo9e4.

&his i e::ect allo9s S0&C to acuire thecostructe4 buil4i' at a price that is :ar belo9 its actualcostructio cost# a4 this costitutes uDust erich*et:or S0&C at the expese o: errer. &his is ot allo9e4 b"la9 b" virtue o: Art 22 o: CC.

F8EREORE# 9ith the above *o4i:icatio irespect o: the a*out o: attore"Ks :ees# the appeale44ecisio o: the Court o: Appeals i CA +.R. C- o%$%5$ is A6RME.

ACTAN CEBU INT@L AIRPORT "S% TUDTUDN,> 14$ 2008



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!ACTS*Pre4ecessors


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!ACTS*8a9aiia


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CORTES % COURT O! APPEALS./ 12$ 2006

!ACTS*

or the purchase price o: 3.7M# -illa Espera,aevelop*et Corporatio =ve4ee@ a4 Atoio Cortes=ve4or@ etere4 ito a cotract o: sale over the lotslocate4 at 0aclara# ParaNaue# Metro Maila. &heCorporatio a4vace4 to Cortes the total su* o:P1#213#$$$.$$. 6 Septe*ber 1/)3# the parties execute4a 4ee4 o: absolute sale o the :ollo9i' ter*s>&he Corporatio shall a4vace 2.2 M as 4o9pa"*et#a4 Cortes shall lie9ise 4eliver the &C& :or the 3 lots.&he balace o: 1.5M shall be pa"able 9ithi a "ear :ro*the 4ate o: the executio.

&he Corporatio :ile4 the istat case :orspeci:ic per:or*ace seei' to co*pel Cortes to 4eliverthe &C&s a4 the ori'ial cop" o: the ee4 o: AbsoluteSale. Accor4i' to the Corporatio# 4espite its rea4iessa4 abilit" to pa" the purchase price# Cortes re:use44eliver" o: the sou'ht 4ocu*ets. 6t pra"e4 :or4a*a'es# attore"s :ees a4 liti'atio expeses. Cortesclai*e4 that the o9ers 4uplicate cop" o: the three&C&s 9ere surre4ere4 to the Corporatio a4 it is thelatter 9hich re:use4 to pa" i :ull the a'ree4 4o9pa"*et.

R&C re4ere4 a 4ecisio resci4i' the salea4 4irecte4 Cortes to retur to the Corporatio thea*out o: P1#213#$$$.$$# plus iterest. CA reverse4 the

4ecisio a4 4irecte4 Cortes to execute a ee4 o:Absolute Sale cove"i' the properties a4 to 4eliverthe sa*e to the Corporatio to'ether 9ith the &C&s#si*ultaeous 9ith the Corporatios pa"*et o: thebalace o: the purchase price o: P2#%)7#$$$.$$.

ISSUES*Fhether or ot Cortes 4elivere4 the &C&s a4

the ori'ial ee4 to the CorporatioO.

FO there is 4ela" i the per:or*ace o: theparties obli'atio that 9oul4 Dusti:" the rescissio o: thecotract o: sale &8ERE 6S EAB 6 0O&8 PAR&6ES=co*pesatio *orae@

HELD*

Cortes avers that he 4elivere4 the &C&sthrou'h the broers so. 8e :urther avers that thebroers so 4elivere4 it to the broer# 9ho i tur4elivere4 the* to the Corporatio.

Marcosa Sache,s urebutte4 testi*o" is thatshe 4i4 ot receive the &C&s. She also 4eie4

o9le4'e o: 4eliver" thereo: to her so# Ma".

Fhat :urther stre'thee4 the :i4i's o: theCourt o: Appeals that Cortes 4i4 ot surre4er thesubDect 4ocu*ets 9as the o::er o: Cortes cousel athe pre


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S 12$ 2003

!ACTS*

&he case at ha4 revolves arou4 a 4ispute4parcel o: co**ercial la4 ori'iall" co


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SPOUSES RAYOS "S% COURT O! APPEALS./ 14$ 2004

!ACTS*O 1/)5# Spouses Ra"os secure4 a short ter*

loa :ro* the Philippie Savi's 0a pa"able 9ithi a

perio4 o: oe "ear i uarterl" istal*ets. 6t 9asevi4ece4 b" a pro*issor" ote a4 the spousesexecute4 a REM over their propert" locate4 i asPias.

O the sa*e "ear the spouses execute4 a ee4o: Absolute Sale 9ith Assu*ptio o: Mort'a'e over thepropert" 9ith spouses Mira4a. 8o9ever# the spousesexecute4 aother 4ocu*et# a cotract to sell the sai4propert" i :avour o: the respo4ets. Respo4etRo'elio Mira4a the :ile4 a applicatio 9ith PS0 tosecure approval o: his assu*ptio o: the petitioersobli'atio o the loa but such 9as 4isapprove4.

evertheless# Ro'elio pai4 the :irst a4 seco4 uarterl"istal*et :or the accout o: petitioers.

Petitoer the receive4 a letter :ro* the bare*i4i' hi* o: the last uarterl" istal*et a4 :eari'that the respo4ets 9ill ot be able to pa" theistal*et# he pai4 the a*out 4ue. 8e the a4vise4 theba ot to tur over the 4uplicate title to respo4ets.

Respo4ets the :ile4 a case a'aistpetitioers a4 the ba clai*i' that the bacospire4 9ith spouses Ra"os i preveti' hi* :ro*pa"i' the last istal*et a4 i re:usi' to tur over the4uplicate title thereb" preveti' the tras:er o: thepropert" to his a*e.

ISSUE*Fhether or ot petitioer ha4 uilaterall"

cacelle4 the cotract 9he he pai4 the last uarterl"istal*et

HELD*

O.6t bears stressi' that the petitioers a4 therespo4ets execute4 t9o iterrelate4 cotracts# vi,> the

ee4 o: Sale 9ith Assu*ptio o: Mort'a'e 4ate4ece*ber 2(# 1/)5# a4 the Cotract to Sell 4ate4!auar" 2/# 1/)(. &o 4eter*ie the itetio o: theparties# the t9o cotracts *ust be rea4 a4 iterprete4to'ether. 4er the t9o cotracts# the petitioers bou4a4 obli'e4 the*selves to execute a 4ee4 o: absolutesale over the propert" a4 tras:er title thereo to therespo4ets a:ter the pa"*et o: the :ull purchase priceo: the propert"# iclusive o: the uarterl" istall*ets4ue o the petitioersK loa 9ith the PS0>

3. &hat upo :ull pa"*et o: the cosi4eratiohereo:# the SEER shall execute a ee4 oAbsolute Sale i :avor o: the 0BER that thepa"*et o: capital 'ais tax shall be :or theaccout o: the SEER a4 that 4ocu*etar"sta*ps# tras:er tax# re'istratio expeses :othe tras:er o: title iclu4i' the otari,atio a4preparatio o: this Cotract a4 subseue

4ocu*ets i: a" are to be execute4# real estatetaxes :ro* !auar" 1# 1/)( a4 othe*iscellaeous expeses shall be :or the accouo: the 0BERL the SEER hereb" represetsthat all associatio 4ues has bee pai4 but thasubseuet to the executio o: this Cotract thepa"*et o: the sa*e shall 4evolve upo the0BER.

Costrui' the cotracts to'ether# it is evi4ethat the parties execute4 a contract to sell and not acontract of sale. &he petitioers retaie4 o9ership

9ithout :urther re*e4ies b" the respo4ets util the

pa"*et o: the purchase price o: the propert" i :ullSuch pa"*et is a positive suspesive co4itio# :ailureo: 9hich is ot reall" a breach# serious or other9ise# buta evet that prevets the obli'atio o: the petitioers tocove" title :ro* arisi'# i accor4ace 9ith Article 11)%o: the Civil Co4e.

&he o


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CORDERO "S% !%S% ANAGEENT DE"ELOPENTO=, 31$ 2006

!ACTS*

0ele Cor4ero a4 ( others# herei petitioers#

etere4 ito a cotract to sell 9ith .S. Maa'e*etevelop*et over 5 parcels o: la4 locate4 i asu'bo#0ata'as. 4er the ter*s o: the cotract# a 4o9pa"*et o: P3.5M a4 the pa"*et o: the re*aii'balace i ( uarterl" istal*ets. 8o9ever# respo4et4e:aulte4 :ro* pa"*et. &hus# a:ter 4e*a4i' therespo4ets to pa" the re*aii' a*out# petitioers:ile4 a co*plait :or rescissio o: the cotract 9ith4a*a'es. Respo4et cote4s that the petitioers

9ere the :irst oes 9ho violate4 the cotract to sell b"preveti' access to the propert" 4espite the pa"*et o:P2.5M 9orth o: earest *oe" a4 that the petitioersre:use4 to execute the :ial cotract o: price.

&he R&C rule4 i :avour o: petitioers 9hile theCA rule4 i :avour o: the respo4ets. 6 their MR#petitioers cote4 that the cotract to sell *a" besubDect to rescissio u4er Art. 11/1 o: the CC as itivolves reciprocal obli'atios.

ISSUE*Fhether or ot a cotract to sell *a" be subDect

to rescissio u4er Art. 11/1

HELD*

O. 4er a cotract to sell# the seller retaistitle to the thi' to be sol4 util the purchaser :ull" pa"sthe a'ree4 purchase price. &he :ull pa"*et is a positivesuspesive co4itio# the o


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!ACTS*

ro* the or4er o: the Court o: irst 6stace o:Maila =i Civil Case o. 31%$/@ 4is*issi' hisco*plait# o the 'rou4 o: prescriptio# plaiti::e4erico Calero iterpose4 this appeal 4irectl" to thisCourt o uestios purel" o: la9.

O !ul" 1)#1/57# 4e:e4at ree9e4 their*otio to 4is*iss# o the 'rou4s that =1@ the a*e4e4co*plait states o cause o: actio =2@ the plaiti::Kscause o: actio# i: a"# is barre4 b" the Statute o:i*itatios =Sec. 1eT# Rule )# Rule o: Court@# a4 =3@ theplaiti::Ks ori'ial co*plait bei' 9ithout cause o:actio# it caot be a*e4e4 a4Qor cure4 b" sai4a*e4e4 co*plait 9hich cha'es plaiti::Ks theor" o:the case. 6 coectio 9ith the seco4 'rou4*etioe4# 4e:e4ats state4>

Plaiti::Ks ri'ht o: actio accrue4 i the "ear 1/379he the :irst o: plaiti::s alle'e4 various o::ersto 4e:e4ats to sell the propert" at price o::ere4b" bu"ers 9as re:use4 b" 4e:e4ats =Pars. 13a4 1% o: Co*plait@. 6t is patet# there:ore# thatis# te =1$@ "ears :ro* the "ear 1/37.Cosi4eri' that plaiti::Ks co*plait 9as :ile4 oece*ber 21# 1/5(# plaiti::Ks cause o: actio i:a"# is obviousl" ue:orceable a4 barre4 b"the Statue o: i*itatios.

&o this *otio# plaiti:: :ile4 his oppositio oAu'ust 2# 1/57# to 9hich 4e:e4ats :ile4 a reDoi4er oAu'ust )# 1/57. &o this reDoi4er# plaiti:: :ile4 a couter 1@ 9he there is a stipulatio to the cotrar"# 2@

9he the obli'or is sue4 :or re:usal to pa" the a'ree4pealt"# a4 3@ 9he the obli'or is 'uilt" o: :rau4. 6these cases# the purpose o: the pealt" is obviousl" topuish the obli'or :or the breach. 8ece# the obli'ee carecover :ro* the :or*er ot ol" the pealt"# but alsoother 4a*a'es resulti' :ro* the o:ul:ill*et o: thepricipal obli'atio.

6 the preset case# the :irst exceptio appliesbecause Article VV =c@ provi4es that# asi4e :ro* thepa"*et o: the retals correspo4i' to the re*aii'ter* o: the lease# the lessee shall also be liable :or a"a4 all 4a*a'es# actual or coseuetial# resulti' :ro*such 4e:ault a4 ter*iatio o: this cotract.I 8avi'etere4 ito the Cotract volutaril" a4 9ith :ullo9le4'e o: its provisios# PA+COR *ust be hel4bou4 to its obli'atios. 6t caot eva4e :urther liabilit":or liui4ate4 4a*a'es.

6 this case# PA+CORs breach 9as occasioe4b" evets that# althou'h ot :ortuitous i la9# 9ere i :actreal a4 pressi'. 9e :i4 that PA+COR co4ucte4 aseries o: e'otiatios a4 cosultatios be:ore eteri'ito the Cotract. 6t 4i4 so ot ol" 9ith the PPC# but

also 9ith local 'over*et o::icials# 9ho assure4 it thatthe proble*s 9ere sur*outable. ie9ise# PA+CORtoo pais to cotes t the or4iaces be:ore the courts#

9hich coseuetl" 4eclare4 the* ucostitutioal. Otop o: these 4evelop*ets# the 'a*i' corporatio 9asa4vise4 b" the O::ice o: the Presi4et to stop the 'a*esi Ca'a"a 4e Oro Cit"# pro*pti' the :or*er to ceaseoperatios prior to Septe*ber 1//3.

ASIATRUST DE"ELOPENT CONCEPTS



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TRADING

!ACTS*

6 March 1//(# respo4et Cocepts &ra4i'Corporatio obtaie4 :ro* petitioer Asiatrust

evelop*et Corporatio a cre4it acco**o4atio i thea*out o: P2#$$$#$$$ covere4 b" a loa a'ree*et a4secure4 b" real a4 chattel *ort'a'es.

&he a*out 9as 4ra9 :ro* a 64ustrial+uaratee oa u4 =6+@ accout opee4 b" thepetitioer i :avor o: the respo4et. O March %# 1/)(#the respo4et execute4 Pro*issor" ote i :avor o: thepetitioer. 4er the pro*issor" ote# the pricipala*out o: P2#$$$#$$$ 9oul4 be char'e4 a iterest o:23J per au*# iclusive o: 1J service :ee. Attache4 toa4 *a4e part o: the pro*issor" ote 9as the sche4uleo: a*orti,atio a'ree4 upo b" the parties. As set :orth ithe sche4ule# the pa"*et o: the loa 9as to be

a*orti,e4 uarterl" over a perio4 o: te "ears 9ith a t9o

... the etire a*out outsta4i' u4er thisote shall i**e4iatel"# 9ithout ee4 :or a" otice#4e*a4# preset*et# protest# or o: a" other act or4ee4# the ri'ht to all o: 9hich is hereb" 9aive4 b" theu4ersi'e4> =i@ beco*e 4ue# pa"able a4 4e:aulte4L=ii@ be subDect to a pealt" euivalet to thirt"


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BES. 0" eteri' ito a *e*ora4u* o:a'ree*et# the ba 9aive4 the 4e*a4abilit" o: theetire loa. 0" such 9aiver# Cocept &ra4i' has otbee re4ere4 i 4e:ault# a4 also# the pealt" 9as

9aive4 u4er the MOA.

4er the sche4ule o: a*orti,atio cotaie4 ithe pro*issor" ote# the respo4et obli'e4 to pa" the

pricipal obli'atio i uarterl" a*orti,atios over aperio4 o: te "ears a4 that i case o: 4e:ault# the etirea*out shall be 4ue a4 4e*a4able i its etiret". Othe other ha4# u4er the MOA# a e9 *o4e o: pa"*et

9as a'ree4 upo# i.e., the pa"*et b" the respo4eto: the iitial a*out o: P15/#25/.1% a4 subseuetpa"*ets o: P15$#$$$ ever" *oth util :ull pa"*et o:the loa obli'atio. &he MOA# i e::ect# re4ere4 theloa o lo'er 4ue a4 4e*a4able i its etiret" at theti*e o: its executio# precisel" because it allo9e4 therespo4et u4er the e9 sche4ule o: pa"*ets to pa"the sa*e b" *othl" istall*ets. 6t bears stressi' thatthe MOA provi4e4 that the *o4e o: pa"*et arose out

o: the 0A;s liberalit".I &o allo9 the petitioer to collectpealt" char'es as i: the respo4et 9ere i 4e:ault#ot9ithsta4i' the existece o: a e9 pa"*etsche4ule# 9oul4 be icosistet 9ith the a:oresai4a'ree*et.

6t *ust be stresse4# ho9ever# that the :ore'oi'shoul4 ot be costrue4 as to *ea that the respo4etcoul4 o lo'er be hel4 i 4e:ault a4 that the petitioerco*pletel" 9aive4 collectio o: pealt" char'es i caseo: 4e:ault. o


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!ACTS*

Petitioers# the spouses e9to a4 Salvacio!iso# etere4 ito a Cotract to Sell 9ith privaterespo4et# Robert O. Phillips Sos# 6c.# 9hereb" thelatter a'ree4 to sell to the :or*er a lot at the -ictoria

-alle" Sub4ivisio i Atipolo# Ri,al :or P55#$$$.$$# 9ithiterest at )#1/(5 per au*# pa"able o a istall*etbasis.

Petitioers pai4 private respo4ets a 4o9pa"*et o: P11#$$$.$$ o October 2$# 1/(1 a4 :ro*October 27# 1/(1L to Ma" )# 1/(5 a *othl" istall*eto: P533.)5. ue to the :ailure o: petitioers to buil4 ahouse as provi4e4 i the cotract# the stipulate4 pealt"o: P5.$$ per suare *eter 9as i*pose4 to the e::ect thatthe *othl" a*orti,atio 9as icrease4 to P7$7.2%.

O !auar" 1# 1/((# ebruar" 1# 1/(( a4March 1# 1/((# petitioers :aile4 to pa" the *othl"

istall*ets 4ue o sai4 4ates althou'h petitioerssubseuetl" pai4 the a*outs 4ue a4 these 9ereaccepte4 b" private respo4et.

Petitioers :aile4 to pa" :ro* October 1/(( to!auar" 1/(7. O !auar" 11# 1/(7# private respo4etset a letter to petitioers calli' their attetio to the :actthat their accout 9as :our *oths over4ue. &his letter

9as :ollo9e4 up b" aother letter 9here privaterespo4et re*i4e4 petitioer o: the auto*aticrescissio clause o: the cotract. Petitioers evetuall"pai4 o March 1# 1/(7.

Petitioers a'ai :aile4 to pa" the *othl"istall*ets 4ue .&hus# private respo4et reture4petitioersK chec a4 i:or*e4 the* that the cotract

9as cacelle4 9he o April 1# 1/(7 petitioers :aile4 topa" the *othl" istall*et 4ue# thereb" *ai' theiraccout 4eliuet :or three *oths.

O April 1/# 1/(7# petitioers te4ere4 pa"*et:or all the istall*ets alrea4" 4ue but the te4er 9asre:use4. Petitioers coutere4 b" :ili' a co*plait :orspeci:ic per:or*ace 9ith the Court o: irst 6stace o:Ri,al o Ma" %# 1/(7 a4 cosi'i' the *othl"istall*ets 4ue 9ith the court.

&he &C re4ere4 Du4'*et i :avor o: privaterespo4et# 4is*issi' the co*plait a4 4eclari' thecotract cacelle4 a4 all pa"*ets alrea4" *a4e b"petitioer :rachise. or4eri' petitioers to pa" P1#$$$.$$as a4 :or attore"Ks :eesL a4 4eclari' the cosi'atioa4 te4er o: pa"*et *a4e b" petitioers as ota*outi' to pa"*et o: the correspo4i' *othl"istall*ets.

ot satis:ie4 9ith the 4ecisio o: the trial court# petitioersappeale4 to the Court o: Appeals. A'reei' 9ith the:i4i's a4 coclusios o: the trial court# the Court o:Appeals o ove*ber %# 1/7( a::ir*e4 the :or*erKs4ecisio.

ISSUE*Fhether or ot rescissio o: the cotract a4 the

:or:eiture o: the pa"*ets alrea4" *a4e b" petitioer isvali4

HELD*

BES. RESC6SS6O O CO&RAC& FAS-A6.

&here is o 4e"i' that i the istat case the

resolutio or rescissio o: the Cotract to Sell 9as vali4either ca it be sai4 that the cacellatio o: the cotrac9as ie::ective :or :ailure o: private respo4ets to 'ivepetitioers otice thereo: as petitioers 9ere i:or*e4cacelle4 private respo4et that the cotract 9ascacelle4 i the letter 4ate4 April (# 1/(7 =Exh. GG@. AsR.A. o. (5)5(# 9as ot "et e::ective# the otice ocacellatio ee4 ot be b" otarial act# privaterespo4etKs letter bei' su::iciet co*pliace 9ith thele'al reuire*et.

&he :acts o: K:ee istat case shoul4 be4isti'uishe4 :ro* those i the Palay Inc. case# assuch 4istictio 9ill explai 9h" the Court i sai4 caseivali4ate4 the resolutio o: the cotract. 6 sai4 casethe sub4ivisio 4eveloper# 9ithout i:or*i' the bu"er othe cacellatio o: the cotract# resol4 the lot to aotherperso. &he lot bu"er i sai4 case 9as ol" i:or*e4 othe resolutio o: the cotract so*e six "ears later a:terthe 4eveloper# reDecte4 his reuest :or authorit" to assi'his ri'hts u4er the cotract. Such a situatio 4oes oobtai illess> the istat case. 6 :act# petitioers 9erei:or*e4 o: the cacellatio o: their cotract i Apri1/(7# 9he private respo4et 9rote the* the lette4ate4 April (# 1/(7 =Exh. GG@# a4 9ithi a *oth the"

9ere able to :ile a co*plait a'aist Private respo4et.

Fhile the resolutio o: the cotract a4 the:or:eiture o: the a*outs alrea4" pai4 are vali4 a4bi4i' upo petitioers# the Court is covice4 that the:or:eiture o: the a*out o: P5.$$ althou'h it iclu4es theaccu*ulate4 :ies :or petitioersK :ailure to costruct ahouse as reuire4 b" the cotract# is clearl" iiuitouscosi4eri' that the cotract price is ol" P(#173.15 &he:or:eiture o: :i:t" percet =5$J@ o: the a*out alrea4"pai4# or P3#2)3.75 appears to be a :air settle*et. 6arrivi' at this a*out the Court 'ives 9ei'ht to the :acthat althou'h petitioers have bee 4eliuet i pa"i'



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their a*orti,atios several ti*es to the preDu4ice o:private respo4et# 9ith the cacellatio o: the cotractthe possessio o: the lot revie9.... to private respo4et

9ho is :ree to resell it to aother part". Also# ha4 R.A. o.(5)5(# bee applicable to the istat case# the sa*eperceta'e o: the a*out alrea4" pai4 9oul4 have bee:or:eite4 &orralba [email protected]

&he CourtKs 4ecisio to re4uce the a*out:or:eite4 :i4s support i the Civil Co4e. As state4 ipara'raph 3 o: the cotract# i case the cotract iscacelle4# the a*outs alrea4" pai4 shall be :or:eite4 i:avor o: the ve4or as liui4ate4 4a*a'es. &he Co4eprovi4es that liui4ate4 4a*a'es# 9hether ite4e4 asa i4e*it" or a pealt"# shall be euitabl" re4uce4 i:the" are iiuitous or ucoscioable AR&.2227. urther#i obli'atios 9ith a peal clause# the Du4'e shalleuitabl" re4uce the pealt" 9he the pricipal obli'atiohas bee partl" or irre'ularl" co*plie4 9ith b" the 4ebtor

LO "S% #S ECO-!OROR#



45/230


!ACTS*

Petitioer o# a buil4i' cotractor# or4ere4sca::ol4i' euip*ets :ro* respo4et ;!S 9orthP5%$#%25.)$. 8e pai4 a 4o9pa"*et i the a*out o:P15$#$$$. &he balace 9as *a4e pa"able i te *othl"

istal*ets. Respo4et 4elivere4 the sca::ol4i's topetitioer. Petitioer 9as able to pa" the :irst t9o *othl"istal*ets. 8o9ever# his busiess# ho9ever#ecoutere4 :iacial 4i::iculties a4 he 9as uable tosettle his obli'atio 4espite 4e*a4s. Petitioer a4respo4et execute4 a ee4 o: Assi'*et# petitioerassi'i' to respo4et his receivables o: P335#%2(.1%:ro* !o*ero Realt" Corp. 8o9ever# 9he therespo4et trie4 to collect :ro* !o*ero# the latter re:use4to hoor the ee4 o: Assi'*et clai*i' that petitioer

9as also i4ebte4 to it. Respo4et the 4e*a4e4 :ro*the petitioer the pa"*et o: his obli'atio# but petitioerre:use4 to pa" clai*i' that his obli'atio ha4 beeexti'uishe4 9he the" execute4 the ee4 o:Assi'*et. As a result# respo4et :ile4 a actio :orrecover" o: a su* o: *oe" a'aist the petitioer.

ISSUE*

Fhether the ee4 o: Assi'*et exti'uishe4the petitioers obli'atio

HELD*

O. A assi'*et o: cre4it is a a'ree*et#9hich is i the ature o: a sale persoal propert"#pro4uce4 the e::ects o: a 4atio i pa"*et 9hich *a"exti'uish the obli'atio. 6 4acio e pa'o# as a special*o4e o: pa"*et# the 4ebtor o::ers aother thi' to thecre4itor 9ho accepts it as euivalet o: pa"*et o: aoutsta4i' 4ebt. 6 or4er that there be a vali4 4atio ipa"*et# the :ollo9i' *ust be preset> =1@ &here *ustbe the per:or*ace o: the prestatio i lieu o: pa"*et#

9hich ca be a cre4it a'aist thir4 persoL =2@ &here*ust be so*e 4i::erece bet9ee the prestatio 4ue a4that 9hich is 'ive i substitutioL =3@ &here *ust be aa'ree*et bet9ee the cre4itor a4 4ebtor that the

obli'atio is i**e4iatel" exti'uishe4 b" reaso o: theper:or*ace o: a prestatio 4i::eret :ro* that 4ue.&heu4ertai' reall" partaes i oe sese o: the ature o:sale# that is# the cre4itor is reall" bu"i' the thi' orpropert" o: the 4ebtor# pa"*et :or 9hich is to bechar'e4 a'aist the 4ebtors 4ebt. As such# petitioer# asve4or or assi'or# is bou4 to 9arrat the existece a4le'alit" o: the cre4it at the ti*e o: the sale or assi'*et.Fhe !o*ero clai*e4 that it 9as o lo'er i4ebte4 topetitioer sice the latter also ha4 a upai4 obli'atio toit# it essetiall" *eat that its obli'atio to petitioer has

bee exti'uishe4 b" co*pesatio. 6 other 9or4srespo4et alle'e4 the o


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!ACTS*

Arro"o Spouses@X# obtaie4 a loa o:P5)$#$$$.$$ :ro* petitioer ba to purchase ($J o: thesubscribe4 capital stoc# a4 thereb" acuire thecotrolli' iterest o: private respo4et &a"abas

Ce*et Co*pa"# 6c. =&CC@. As securit" :or sai4loa# the spouses Arro"o execute4 a real estate*ort'a'e over a parcel o: la4 a -ista propert". &CCthe :ile4 9ith petitioer ba a applicatio a4a'ree*et :or the establish*et o: a ei'ht =)@ "ear4e:erre4 letter o: cre4it =QC@ :or 7#$$$#$$$.$$ i :avor o:&o"o Mea ;aisha# t4. to cover the i*portatio o: ace*et plat *achier" a4 euip*et. po approvalo: sai4 applicatio a4 opei' o: a QC the Arro"ospouses execute4 a Suret" A'ree*et a4 Coveat tosecure the loa acco**o4atio. &he i*porte4 ce*etplat *achier" a4 euip*et arrive4 :ro* !apa a4

9ere release4 to &CC u4er a trust receipt a'ree*et.&CC# :aile4 to re*it a4Qor pa" the correspo4i'a*out covere4 b" the 4ra9i's. &hus# P0 oti:ie4&CC o: its itetio to repossess# as it later 4i4# thei*porte4 *achier" a4 euip*et :or :ailure o: &CC tosettle its obli'atios u4er the QC. 6 the *eati*e# thepersoal accouts o: the spouses Arro"o# 9hich iclu4e4aother loa o: P1($#$$$.$$ secure4 b" a real estate*ort'a'e over parcels o: a'ricultural la4 o9 as8acie4a 0aco ha4 lie9ise beco*e 4ue. ailure o:Arro"o spouses to pa" the loa# P0 :ile4 a petitio :orextra


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PCIBAN# "S% CA

!ACTS*

PC60 a4# Maila 0ai' Corporatio =M0C@9ere Doit bi44ers i a :oreclosure sale o: assorte4

*ii' *achier" a4 euip*et previousl" *ort'a'e4to the* b" the Philippie 6ro Mies# 6c. =P6M@. our"ears later# Atlas a'ree4 to purchase so*e o: theseproperties o9e4 Doitl" b" PC60 a4 M0C# evi4ece4 b"a ee4 o: Sale 9ith the parties a'reei' therei to aiitial 4o9pa"*et o: P12#$$$#$$$.$$ a4 the balaceo: P1)#$$$#$$$.$$ pa"able i six *othl" istall*ets.&he cotract cotaie4 certai provisios expressl"

9arrati' the properties :ree :ro* all lies a4ecu*braces a4 :reei' Atlas :ro* all clai*s a4ici4etal actios o: the uio AMAF. &he AMAFthe *a4e a clai* 9hich ste**e4 :ro* a labor 4ispute

9herei AMAF obtaie4 a :avorable Du4'*eta'aist P6M i the a*out o: P%#2/)#3$7.77# 9hich Atlas

pai4.

Accor4i' to Atlas# apart :ro* the 4o9pa"*eta4 istall*et pa"*ets it shoul4 be cre4ite4 9ith itspa"*et o: P%#2/)#3$7.77 to AMAF. &hus# Atlasclai*s to have *a4e a overpa"*et a4 that PC60shoul4 rei*burse to it P233#()%.23. Fhe PC60 re:use4to pa"# Atlas sue4 PC60 to obtai rei*burse*et o: thealle'e4 overpa"*et. PC60 cote4e4 that Atlas stillo9e4 it a total o: P/$)#3/).75. 6t also alle'e4 that evebe:ore the 9rit o: 'arish*et 9as serve4 o Atlas# the

Du4'*et i :avor o: AMAF 9as re4uce4 a4 ha4alrea4" bee partiall" satis:ie4. Atlas coul4 ot cre4it thea*out receive4 b" AMAF i satis:actio o: the Atlasobli'atio to PC60.

ISSUE*

Fhether or ot PC60 ca 4e*a4 :ro* Atlas*ore tha 9hat it receive4 :ro* M0C

Fhether or ot Atlas ca 4e*a4rei*burse*et :ro* PC60 :or the pa"*et *a4e to

AMAF

HELD*

=1@ o. &his case is 4ee*e4 as a Doitobli'atio# 9here there is a cocurrece o: severalcre4itors# or o: several 4ebtors or o: several 4ebtors or o:several cre4itors a4 4ebtors# b" virtue o: 9hich each o:the cre4itors has a ri'ht to 4e*a4# a4 each o: the4ebtors is bou4 to re4er# co*pliace 9ith his

proportioate part o: the prestatio 9hich costitutes theobDect o: the obli'atio. Article 12$) o: the Civil Co4e*a4ates the eual shari' o: cre4itors i the pa"*eto: 4ebt i the absece o: a" la9 or stipulatio to thecotrar". &here 9as "et o a'ree*et as o: that 4atecoceri' the correspo4i' share o: each cre4itor. 6

9as ol" o ) March 1/7/ 9he PC60 co**uicate4 toAtlas the perceta'e o: pa"*ets to be re*itte4 to PC60

a4 M0C. 0e:ore sai4 4ate# Atlas coul4 be secure i thethou'ht that the *atter o: shari' 9as best le:t to thecre4itors to 4eci4e. &he a*out etitle to PC60 isthere:ore a iteral *atter bet9ee it a4 M0C.

=2@ As :ou4 b" the Court the Du4'*et oAMAFs clai* 9as re4uce4 it toP3#(/7#$%7.77Clearl"# Atlas overpai4 AMAF. 6t i**e4iatel" pai4AMAF# 9ithout *ai' a" ivesti'atio ocosultatio 9ith PC60. Article 123( o: the Civil Co4eapplies i this istace that 9hoever pa"s :or aother*a" 4e*a4 :ro* the 4ebtor 9hat he has pai4# excepthat i: he pai4 9ithout the o9le4'e or a'aist the 9ill o:the 4ebtor# he ca recover ol" iso:ar as the pa"*ehas bee bee:icial to the 4ebtor. PC60 is the 4ebtor ithis case# 9hile Atlas is the thir4 perso 9ho pai4 theobli'atio o: the 4ebtor 9ithout the latters o9le4'ea4 coset. Atlas the *a" ol" recover :ro* PC60 thea*out o: pa"*et 9hich has bee:ite4 the latter. 6: the4ebt has bee pai4 such as i this case# a pa"*et b" athir4 perso 9oul4 costitute a pa"*et o: 9hat is o4ueL his re*e4" 9oul4 be a'aist the perso 9horeceive4 the pa"*et =AMAF@ a4 ot a'aist the4ebtor 9ho 4i4 ot bee:it :ro* the pa"*et.



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CULABA "S% CA '() SAN IGUEL CORP%

!ACTS*

&he spouses Culaba 9ere the o9ers o: theCulaba store a4 9ere e'a'e4 i the sale a44istributio o: Sa Mi'uel Corp.s beer pro4ucts. SMC solbeer pro4ucts the Culaba spouses i the a*out o:P2)#(5$.$$ as evi4ece4 b" a &e*porar" Cre4it 6voice.Caluba spouses *a4e a partial pa"*et o: P3#7%$leavi' a upai4 balace o: P2%#/1$. As the" :aile4 topa" 4espite 4e*a4s# SMC :ile4 a actio :or collectioo: a su* o: *oe" a'aist the*. e:e4at ?spouses4eie4 a" liabilit"# clai*i' that the" ha4 alrea4" pai4the plaiti:: i :ull separate occasios. e:e4atspresete4 :our &e*porar" Char'e Sales iui4atio

Receipts =&CS@. racisco Caluba testi:ie4 that he*a4e the pa"*ets to a SMC supervisor 9ho ca*e ia SMC va. 8e 9as the sho9e4 a list o: custo*ersaccoutabilities 9hich iclu4e4 his accout. SMC thesub*itte4 a publishers a::i4avit to prove that the etireboolet o: &CS Receipts beari' os. 273$1


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TONE & CITY DE"ELOPENT CORPORATION "S%CA '() GUILLERO R% "OLUNTAD

!ACTS*

Respo4et +uiller*o -oluta4 =+uiller*o@ a4petitioer &o9e Cit" evelop*et Corporatio 9ere

both e'a'e4 i the costructio busiess. &he" etere4ito a cotract :or the =a@ costructio o: several housi'uits belo'i' to or reserve4 :or 4i::eret i4ivi4ualsL=b@ repair o: several existi' housi' uits belo'i' to4i::eret i4ivi4ualsL a4 =c@ repair o: :acilities# all locate4at the -ir'iia -alle" Sub4ivisio# o9e4 a4 4evelope4b" the petitioer. &he total cotract cost a*oute4 toOe Millio ort" Oe &housa4 &hree 8u4re4 i:t"ie =P1#$%1#35/.$$@ Pesos.

&he parties a'ree4 that +uiller*o shoul4 bepai4 i :ull b" petitioer the a'ree4 cotract cost upoco*pletio o: the proDect. Pe4i' co*pletio o: the

proDect# +uiller*o 9as allo9e4 b" petitioer to occup"#:ree o: char'e# oe o: its houses at the -ir'iia -alle"Sub4ivisio.A:ter co*pleti' the costructio a4 repair 9orssubDect o: the cotract# +uiller*o 4e*a4e4 pa"*et :orhis services.

Fhe petitioer :aile4 to satis:" his clai* i :ull#+uiller*o :ile4 o April 3$# 1//$ a Co*plait :orcollectio a'aist petitioer be:ore the R&C o: Mailaalle'i' that petitioer pai4 hi* ol" the a*out o:P(/#%$$.$$# leavi' a balace o: P/71#/5/.$$ u4er theter*s o: their cotract.

6 its As9er 9ith Couter


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NOEI % CORONEL "S% ENCARNACION C% CAPATIG% R% N,% 157836% ' 26$ 2005

SM> Exti'uish*et o: Pa"*et

!ACTS*

Petitioer cotracte4 t9o loas :ro* respo4eto Septe*ber %# 1//2 a4 October 25# 1//2. &he :irsta*oute4 to P121#$$$.$$ pa"able o or be:oreebruar" %# 1//3 a4 the seco4 a*oute4 toP3(3#$$$.$$ pa"able o or be:ore March 25# 1//3. 6retur# petitioer issue4 respo4et t9o checs :or the:irst a4 seco4 loa. &he t9o loas are e*bo4ie4 it9o ha49ritte istru*ets.

Petitioer :aile4 to pa" her loas upo *aturit"4espite repeate4 4e*a4s :ro* respo4et. &he t9ochecs she issue4 9ere 4ishoore4 9he presete4 :orpa"*et o ebruar" 1(# 1//3 a4 April 7# 1//3.

8ece# o Septe*ber 1%# 1//3# respo4et :ile4 aco*plait :or su* o: *oe" a4 4a*a'es 9ithattach*et a'aist petitioer be:ore the Re'ioal &rialCourt o: +ua'ua# Pa*pa'a.

Petitioer 4eie4 cotracti' the t9o loas i thea*outs o: P121#$$$.$$ a4 P3(3#$$$.$$ :ro*respo4et. She alle'e4 that the Metroba checsrepreseti' the :ore'oi' a*outs 9ere t9o o: severalchecs she issue4 i :avor o: respo4et :or a loaa*outi' to P1.1$1 *illio 9hich she has :ull" pai4.She clai*e4 that 4espite :ull pa"*et# respo4et still4eposite4 the t9o checs because o: a 4ispute bet9eethe* arisi' :ro* respo4ets 4e*a4 :or exorbitata4 a44itioal iterest o the P1.1$1 *illio loa.

Petitioer alle'e4 :urther that there 9ereistaces 9he respo4et ase4 her to a::ix hersi'ature o bla sheets o: paperY thereb" i*pl"i' thatthe cotets o: Exhibits cotaii' the loa a'ree*ets

9ere 9ritte b" respo4et o sheets o: paper si'e4 ia4vace b" petitioer.

&he R&C rule4 i :avor o: respo4et or4eri'hi* to pa". &he CA a::ir*e4 such 4ecisio. 8ece# thispetitio.

ISSUE*

Fhether pa"*et 9as *a4e a4 that it 9as :ull"exti'uishe4.

HELD*

Petitioer tries to escape resposibilit" b"testi:"i' that it has bee respo4ets practice to as

her to si' bla sheets o: paper. She 9ats the courto believe that she 4i4 ot o9 o: the cotets oExhibits A


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NAGA TELEPHONE CO%$ INC% :NATELCO; ANDLUCIANO % AGGAY "S%

CA AND CAARINES SUR II ELECTRICCOOPERATI"E$ INC% :CASURECO II;

G%R% N,% 107112 !.' 24$ 1994

!ACTS*

Petitioer a'a &elephoe Co.# 6c. =A&ECO@is a telephoe co*pa" re4eri' local as 9ell as lo'4istace telephoe service i a'a Cit" 9hile privaterespo4et Ca*aries Sur 66 Electric Cooperative# 6c.=CASRECO 66@ is a private corporatio establishe4 :orthe purpose o: operati' a electric po9er service i thesa*e cit".

O ove*ber 1# 1/77# the parties etere4 ito a

cotract :or the use b" petitioers i the operatio o: itstelephoe service the electric li'ht posts o: privaterespo4et i a'a Cit". 6 cosi4eratio there:or#petitioers a'ree4 to istall# :ree o: char'e# te =1$@telephoe coectios :or the use b" private respo4et.&he sai4 cotract also provi4e4>

&hat the ter* or perio4 o: this cotract shall beas lo' as the part" o: the :irst part has ee4 :or theelectric li'ht posts o: the part" o: the seco4 part it bei'u4erstoo4 that this cotract shall ter*iate 9he :ora" reaso 9hatsoever# the part" o: the seco4 part is:orce4 to stop# aba4oe4 sicT its operatio as a publicservice a4 it beco*es ecessar" to re*ove the electricli'htpostL

A:ter the cotract ha4 bee e:orce4 :or over te=1$@ "ears# private respo4et :ile4 9ith R&C a'aistpetitioers :or re:or*atio o: the cotract 9ith 4a*a'es#o the 'rou4 that it is too oe


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12(7 states i our la9 the 4octrie o: u:orsee evets.&his is sai4 to be base4 o the 4iscre4ite4 theor" o:rebus sic statibus i public iteratioal la9L u4er thistheor"# the parties stipulate i the li'ht o: certaiprevaili' co4itios# a4 oce these co4itios ceaseto exist the cotract also ceases to exist. Cosi4eri'practical ee4s a4 the 4e*a4s o: euit" a4 'oo4:aith# the 4isappearace o: the basis o: a cotract 'ives

rise to a ri'ht to relie: i :avor o: the part" preDu4ice4.

O the issue o: re:or*atio o: cotract#petitioers alle'e that respo4et courtKs ruli' that theri'ht o: actio Garose ol" a:ter sai4 cotract ha4 alrea4"beco*e 4isa4vata'eous a4 u:air to it 4ue tosubseuet evets a4 co4itios# 9hich *ust beso*eti*e 4uri' the latter part o: 1/)2 or i 1/)3 . . .G iserroeous. 6 re:or*atio o: cotracts# 9hat is re:or*e4is ot the cotract itsel:# but the istru*et e*bo4"i'the cotract. 6t :ollo9s that 9hether the cotract is4isa4vata'eous or ot is irrelevat to re:or*atio a4there:ore# caot be a ele*et i the 4eter*iatio o:

the perio4 :or prescriptio o: the actio to re:or*.

Article 11%% o: the e9 Civil Co4e provi4es#iter alia# that a actio upo a 9ritte cotract *ust bebrou'ht 9ithi te =1$@ "ears :ro* the ti*e the ri'ht o:actio accrues. Clearl"# the te =1$@ "ear perio4 is to berecoe4 :ro* the ti*e the ri'ht o: actio accrues 9hichis ot ecessaril" the 4ate o: executio o: the cotract.As correctl" rule4 b" respo4et court# privaterespo4etKs ri'ht o: actio arose Gso*eti*e 4uri' thelatter part o: 1/)2 or i 1/)3 9he accor4i' to Att".uis +eeral# !r. . . .# he 9as ase4 b" =privaterespo4etKs@ 0oar4 o: irectors to stu4" sai4 cotractas it alrea4" appeare4 4isa4vata'eous to =privaterespo4et@ =p. 31# ts# Ma" )# 1/)/@. =Privaterespo4etKs@ cause o: actio to as :or re:or*atio o:sai4 cotract shoul4 thus be cosi4ere4 to have ariseol" i 1/)2 or 1/)3# a4 :ro* 1/)2 to !auar" 2# 1/)/

9he the co*plait i this case 9as :ile4# te =1$@ "earsha4 ot "et elapse4.G

Re'ar4i' the last issue# petitioers alle'e thatthere is othi' purel" potestative about the prestatioso: either part" because petitioerKs per*issio :or :reeuse o: telephoes is ot *a4e to 4epe4 purel" o their

9ill# either is private respo4etKs per*issio :or :reeuse o: its posts 4epe4et purel" o its 9ill.

PetitioersK alle'atios *ust be uphel4 i this re'ar4. Apotestative co4itio is a co4itio# the :ul:ill*et o:

9hich 4epe4s upo the sole 9ill o: the 4ebtor# i 9hichcase# the co4itioal obli'atio is voi4. 0ase4 o this4e:iitio# respo4et courtKs :i4i' that the provisio ithe cotract# to 9it>

=a@ &hat the ter* or perio4 o: this cotractshall be as lo' as the part" o: the :irst part=petitioer@ has ee4 :or the electric li'ht posts o: thepart" o: the seco4 part =private respo4et@ . . ..

is a potestative co4itio# is correct. 8o9ever# it *ushave overlooe4 the other co4itios i the sa*eprovisio# to 9it>

. . . it bei' u4erstoo4 that this cotracshall ter*iate 9he :or a" reaso 9hatsoever# thepart" o: the seco4 part =private respo4et@ is :orce4to stop# aba4oe4 =sic@ its operatio as a publicservice a4 it beco*es ecessar" to re*ove the

electric li'ht post L9hich are casual co4itios sice the" 4epe4 ochace# ha,ar4# or the 9ill o: a thir4 perso. 6 su*the cotract is subDect to *ixe4 co4itios# that isthe" 4epe4 partl" o the 9ill o: the 4ebtor a4 partl"o chace# ha,ar4 or the 9ill o: a thir4 perso# 9hich4o ot ivali4ate the a:ore*etioe4 provisio

!ALLO*Petitio E6E. CA 4ecisio A6RME.

TRANS-PACI!IC INDUSTRIAL SUPPLIES$ INC%"S% CA '() ASSOCIATED BAN#



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G%R% N,% 109172 A..= 19$ 1994

!ACTS*

6 1/7/# petitioer applie4 :or a4 9as 'rate4several :iacial acco**o4atios a*outi' to P1.3 Mb" respo4et Associate4 0a. &he loas 9ere

evi4ece4 a4 secure4 b" :our =%@ pro*issor" otes# areal estate *ort'a'e coveri' three parcels o: la4 a4a chattel *ort'a'e over petitioerKs stoc a4ivetories.able to settle its obli'atio i :ull# petitioer reueste4:or# a4 9as 'rate4 b" respo4et ba# a restructuri'o: the re*aii' i4ebte4ess 9hich the a*oute4 toP1#$57#5$$.$$# as all the previous pa"*ets *a4e 9ereapplie4 to pealties a4 iterests.

&o secure the re


54/230


!ACTS*

O various 4ates i October# ove*ber a4ece*ber# 1/75# +re'orio 4e eo 4oi' busiessu4er the a*e a4 st"le o: Mar 64ustrial Sales sol4a4 4elivere4 to Silahis Mareti' Corporatio variousite*s o: *ercha4ise covere4 b" several ivoices i the

a''re'ate a*out o: P22#213.75 pa"able 9ithi thirt"=3$@ 4a"s :ro* 4ate o: the coveri' ivoices.

Alle'e4l" 4ue to SilahisK :ailure to pa" its accoutupo *aturit" 4espite repeate4 4e*a4s# 4e eo :ile4a co*plait :or the collectio o: the sai4 accoutsiclu4i' accrue4 iterest thereo i the a*out o:P((1.$3 a4 attore"Ks :ees o: P5#$$$.$$ plus costs o:liti'atio.

&he as9er a4*itte4 the alle'atios o: theco*plait iso:ar as the ivoices 9ere cocere4 butpresete4 as a::ir*ative 4e:esesL aT a 4ebit *e*o :or

P22#2$$.$$ as ureali,e4 pro:it :or a suppose4co**issio that Silahis shoul4 have receive4 :ro* 4eeo :or the sale o: sprocets i the a*out o:P111#$$$.$$ *a4e 4irectl" to ole Philippies#6corporate4 b" the latter so*eti*e i Au'ust 1/75L a4bT SilahisK clai* that it is etitle4 to retur the stailesssteel scree 9hich 9as :ou4 4e:ective b" its cliet#0or4e 6teratioal# avao Cit"# a4 to have thecorrespo4i' a*out cacelle4 :ro* its accout 9ith4e eo.

ISSUE*

Fhether or ot private respo4et is liable to thepetitioer :or the co**issio or *ar'i :or the 4irectsale 9hich the :or*er coclu4e4 a4 cosu**ate4 9ithole Philippies# 6corporate4 9ithout coursi' thesa*e throu'h herei petitioer.

HELD*

6t *ust be re*e*bere4 that co*pesatio taesplace 9he t9o persos# i their o9 ri'ht# are cre4itorsa4 4ebtors to each other. Article 127/ o: the Civil Co4eprovi4es that> G6 or4er that co*pesatio *a" be

proper# it is ecessar"> 1T that each oe o: the obli'orsbe bou4 pricipall"# a4 that he be at the sa*e ti*e apricipal cre4itor o: the otherL 2T that both 4ebts cosisti a su* o: *oe"# or i: the thi's 4ue are cosu*able#the" be o: the sa*e i4# a4 also o: the sa*e ualit" i:the latter has bee state4L 3T that the t9o 4ebts be 4ueL%T that the" be liui4ate4 a4 4e*a4ableL 5T that overeither o: the* there be a" retetio or cotrovers"#co**ece4 b" thir4 persos a4 co**uicate4 i 4ueti*e to the 4ebtor.G

4oubte4l"# petitioer a4*its the vali4it" o: itsoutsta4i' accouts 9ith private respo4et i thea*out o: P22#213.75 as cotaie4 i its as9er. 0ut

9hether private respo4et is liable to pa" the petitioea 2$J *ar'i or co**issio o the subDect sale to olePhilippies# 6c. is vi'orousl" 4ispute4. &hiscircu*stace prevets le'al co*pesatio :ro* tai'place.

&he Court a'rees 9ith respo4et appellatecourt that there is o evi4ece o recor4 :ro* 9hich ica be i:erre4 that there 9as a" a'ree*et bet9eethe petitioer a4 private respo4et prohibiti' thelatter :ro* selli' 4irectl" to ole Philippies6corporate4. e:iitel"# it caot be asserte4 that the4ebit *e*o 9as a cotract bi4i' bet9ee the partiescosi4eri' that the sa*e# as correctl" :ou4 b" theappellate court# 9as ot si'e4 b" private respo4etor 9as there a" *etio therei o: a" co**it*et b"the latter to pa" a" co**issio to the :or*er ivolvi'the sale o: sprocets to ole Philippies# 6c. i the

a*out o: P111#$$$.$$.

64ee4# such 4ocu*et ca be tae as sel:

1. &here *ust be a previous vali4 obli'atio#2. &here *ust be a a'ree*et o: the parties cocere4to a e9 cotract#3. &here *ust be the exti'uish*et o: the ol4 cotract

a4%. &here *ust be the vali4it" o: the e9 cotract.

&he ele*ets o: ovatio are patetl" laci' ithe istat case. MaNalac te4ere4 a chec :oP1#2$$#$$$.$$ to PS0a :or the release o: % parcels ola4 covere4 b" &C& os.


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ol4 oe. po the other ha4# o speci:ic :or* isreuire4 :or a i*plie4 ovatio# a4 all that isprescribe4 b" la9 9oul4 be a ico*patibilit" bet9eethe t9o cotracts. Fhile there is reall" o har4 a4 :astrule to 4eter*ie 9hat *i'ht costitute to be a su::icietcha'e that ca bri' about ovatio# the touchstoe :orcotrariet"# ho9ever# 9oul4 be a irrecocilableico*patibilit" bet9ee the ol4 a4 the e9 obli'atios.

either ca MaNalac be 4ee*e4 substitute4ebtor 9ithi the cote*platio o: Article 12/3 o: theCivil Co4e# 9hich states that>

Art. 12/3. ovatio 9hich cosists isubstituti' a e9 4ebtor i the place o: the ori'ial oe#*a" be *a4e 9ithout the o9le4'e or a'aist the 9illo: the latter# but ot 9ithout the coset o: the cre4itor.Pa"*et b" the e9 4ebtor 'ives hi* the ri'hts*etioe4 i articles 123( a4 1237.

6 or4er to cha'e the perso o: the 4ebtor# theol4 oe *ust be expressl" release4 :ro* the obli'atio#

a4 the thir4 perso or e9 4ebtor *ust assu*e the:or*ers place i the relatio. ovatio is everpresu*e4. Coseuetl"# that 9hich arises :ro* apurporte4 cha'e i the perso o: the 4ebtor *ust beclear a4 express. 6t is thus icu*bet o MaNalac tosho9 clearl" a4 ueuivocall" that ovatio has i4ee4tae place. 6 a+dalena -states Inc. v. 'odri+"e#9ehel4 that Gthe *ere :act that the cre4itor receives a'uarat" or accepts pa"*ets :ro* a thir4 perso 9hohas a'ree4 to assu*e the obli'atio# 9he there is oa'ree*et that the :irst 4ebtor shall be release4 :ro*resposibilit"# 4oes ot costitute a ovatio# a4 thecre4itor ca still e:orce the obli'atio a'aist the

ori'ial 4ebtor.G

MaNalac has ot sho9 b" co*petet evi4ecethat the" 9ere expressl" tai' the place o: +alicia as4ebtor# or that the latter 9ere bei' release4 :ro* theirsoli4ar" obli'atio. or 9as it sho9 that the obli'atioo: the +alicias 9as bei' exti'uishe4 a4 replace4 b"a e9 oe. &he existece o: ovatio *ust be sho9 iclear a4 u*istaable ter*s.

+rati' ar+"endo that a e9 obli'atio 9asestablishe4 9ith the acceptace b" the ba o: the PC60Chec a4 its applicatio to the loa accout o: MaNalaco the co4itio that &C& o. %17$12 9oul4 berelease4# this e9 obli'atio ho9ever coul4 ot supplatthe October 13# 1/77 real estate *ort'a'e execute4 b"MaNalac# 9hich# b" all itets a4 purposes# is o9 a4e:uct a4 o


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also si'e4 a Cotiui' Suret"ship A'ree*et i:avour o: Phil&rust 0a# as Presi4et o: Astro a4 assuret".

&herea:ter# Phil'uaratee 9ith the coset o:Astro 'uaratee4 i :avour o: Phil&rust the pa"*et o:7$J o: Astros loa# subDect to the co4itio that upopa"*et# it shall be proportioall" subro'ate4 to the

ri'hts o: Phil&rust a'aist Astro.

As a result o: Astros :ailure to pa" 4espite4e*a4s# Phil +uaratee :ile4 a'aist Astro a4 Roxasa co*plait :or su* o: *oe" i the Maati R&C. R&Cre4ere4 Du4'*et 'iats petitioer 9hich 9as a::ir*e4b" the CA.

ISSUE*

Fhether or ot Roxas shoul4 be hel4 soli4aril"liable 9ith Astro :or the su* o: *oe"

HELD*

BES. &he istat case is oe o: the le'alsubro'atio that occurs b" operatio o: la9# a4 9ithoutee4 o: the 4ebtors o9le4'e. urther# Phil'uaratee#as 'uarator# beca*e the tras:eree o: all the ri'hts o:Philtrust as a'aist Roxas a4 Astro because the'uarator 9ho pa"s is subro'ate4 b" virtue thereo: toall the ri'hts 9hich the cre4itor ha4 a'aist the 4ebtor.I

Subro'atio is the tras:er o: all ri'hts o: thecre4itor to a thir4 perso# 9ho substitutes hi* i all hisri'hts. 6t *a" either be le'al or covetioal. e'alsubro'atio is that 9hich taes 9ithout a'ree*et but b"operatio o: la9 because o: certai acts. 6staces o:le'al subro'atio are those provi4e4 i Art. 13$2 o: theCivil Co4e. Covetioal subro'atio# o the other ha4#is that 9hich taes place b" a'ree*et o: the parties.

6 the istat case# Astros loa 9ith Philtrust0a is secure4 b" three pro*issor" otes. &hesepro*issor" otes are vali4 a4 bi4i' a'aist Astro a4Roxas. As it appears o the otes# Roxas si'e4 t9ice>:irst# as presi4et o: Astro a4 seco4# i his persoalcapacit". 6 si'i' his a*e asi4e :ro* bei' the

Presi4et o: Asro# Roxas beca*e a co


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aouce4 i a *eeti' 9ith the e*plo"ees that it 9oul4cease operatios o Au'ust 13# 1/)7# 4ue to serious:iacial losses. Operatios 4i4 cease as aouce4.O Au'ust 17# 1/)7# the uio :ile4 a co*plait 9ith theepart*et o: abor a'aist the petitioers :or ille'allocout# u:air labor practice a4 4a*a'es# :ollo9e4 theext 4a" 9ith aother co*plait :or pa"*et o: upai4

9a'es# e*er'ec" cost o: livi' allo9aces# holi4a"

pa"# a4 other bee:its.

O ove*ber 2/# 1/))# the abor Arbiter4eclare4 the shut4o9 ille'al a4 violative o: thee*plo"eesK ri'ht to sel:

AR&. (. Ri'hts *a" be 9aive4# uless the 9aiver iscotrar" to la9# public or4er# public polic"# *orals# or'oo4 custo*s# or preDu4icial to a thir4 perso 9ith a ri'htreco'i,e4 b" la9.

AR&. 13$(. &he cotracti' parties *a" establish suchstipulatios# clauses# ter*s a4 co4itios as the" *a"

4ee* coveiet# provi4e4 the" are ot cotrar" to la9*orals# 'oo4 custo*s# public or4er# or public polic".

&he subor4iate positio o: the i4ivi4uae*plo"ee vis/a/vis*aa'e*et re4ers hi* especiall"vulerable to its bla4ish*ets a4 i*portui's# a4eve iti*i4atios# that *a" result i his i*provi4etl" ireluctatl" si'i' over bee:its to 9hich he is clearl"

etitle4. Reco'i,i' this 4a'er# 9e have cosistetl"hel4 that uitclai*s o: the 9orersK bee:its 9i oestop the* :ro* asserti' the* Dust the sa*e o the'rou4 that public polic" prohibits such 9aivers.

&hat the e*plo"ee has si'e4 a satis:actioreceipt 4oes ot result i a 9aiverL the la9 4oes ocosi4er as vali4 a" a'ree*et to receive lessco*pesatio tha 9hat a 9orer is etitle4 to recoverA 4ee4 o: release or uitclai* caot bar a e*plo"ee:ro* 4e*a4i' bee:its to 9hich he is le'all" etitle4.

Release a4 uitclai* is ieuitable a4

ico'ruous to the 4eclare4 public polic" o: the State toa::or4 protectio to labor a4 to assure the ri'hts o9orers to securit" o: teure.

All tol4# the co4uct o: the petitioers to9ar4 thee*plo"ees has bee less tha co**e4able. 64ee4# iis reprehesible. irst# the co*pa" ivei'le4 the* to

9aive their clai*s to co*pesatio 4ue the* o thepro*ise that :uture bee:its 9oul4 be pai4 =a4 to *ae*atters 9orse# there is o sho9i' that the" 9erei4ee4 pai4@. Seco4# it re:use4 to reco'i,e therespo4et uio# su''esti' to the e*plo"ees that the"

Doi aother uio acceptable to *aa'e*et. &hir4# ithreatee4 the e*plo"ees 9ith the closure o: theco*pa" a4 the actuall" 4i4 so 9he the e*plo"eesisiste4 o their 4e*a4s. All these acts re:lect o thebona fideso: the petitioers a4 u*istaabl" i4icatetheir ill 9ill to9ar4 the e*plo"ees.

ACOL "S% PHILIPPINE COERCIAL CREDIT CARD

INCORPORATED./ 25$ 2006

!ACTS*

O Au'ust 2$# 1/)2# petitioer Mauel Acoapplie4 9ith respo4et :or a 0aar4 cre4it car4 a4extesio. 0oth 9ere issue4 to hi* shortl" therea:teror several "ears# he re'ularl" use4 this car4purchasi' :ro* respo4etKs accre4ite4 establish*etsa4 pa"i' the correspo4i' char'es :or such



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purchases. Petitioer 4iscovere4 the loss o: his cre4itcar4. A:ter exhausti' all e::orts to :i4 it# o April 1/#1/)7# a Su4a"# he calle4 up respo4etKs o::ice a4reporte4 the loss. &he represetative he spoe to tol4hi* that his car4 9oul4 be i**e4iatel" iclu4e4 i thecircular o: lost car4s.

A'ai# o April 2$# 1/)7# petitioer calle4 up

respo4et to reiterate his report o the loss o: his car4.8e iuire4 i: there 9ere other reuire*ets he ee4e4to co*pl" 9ith i coectio 9ith the loss. Respo4etKsrepresetative a4vise4 hi* to put ito 9riti' the oticeo: loss a4 to sub*it it# to'ether 9ith the extesio car4so: his 9i:e a4 4au'hter. Petitioer pro*ptl" 9rote aletter 4ate4 April 2$# 1/)7 co:ir*i' the loss a4 set itto respo4et 9hich receive4 it o April 22# 1/)7.

O April 21# 1/)7# a 4a" be:ore receivi' the9ritte otice# respo4et issue4 a special cacellatiobulleti i:or*i' its accre4ite4 establish*ets o: theloss o: the car4s o: the eu*erate4 hol4ers# iclu4i'

petitioerKs. :ortuatel"# it ture4 out that so*ebo4"use4 petitioerKs car4 o April 1/ a4 2$# 1/)7 to bu"co**o4ities 9orth P7(#$(7.2). &he accre4ite4establish*ets reporte4 the ivoices :or such purchasesto respo4et 9hich the bille4 petitioer :or thata*out.

oetheless# respo4et isiste4 o colleti'a4 alle'e4 that it 9as the *ost practicable proce4ure o:the co*pa". 6t cite4 provisio o. 1 o: the G&er*s a4Co4itios +overi' &he 6ssuace a4 se o: the0aar4G :ou4 at the bac o: the applicatio :or*>xxx 8ol4erKs resposibilit" :or all char'es *a4e throu'h the use o: thecar4 shall cotiue util the expiratio or its retur to the Car4 6ssuer or

util a reasoable ti*e a:ter receipt b" the Car4 6ssuer o:9ritteotice o: loss o: the Car4 a4 its actual iclusio i the Cacellatio0ulleti. xxx

R&C rule4 i :avour o: petitioer but 9asreverse4 b" CA. 8ece this istat petitio be:ore theSC.

ISSUE*Fhether or ot Provisio o. 1 is vali4 a4

bi4i' o the petitioer 'ive that the cotract 9as oeo: a4hesio

HELD*

O. &he :acts o: this case are virtuall" i4etical9ith those o: -rmita0o v. C(. 6 that case# petitioer

&he Co*pa" a4 the Supervisor *utuall" a'ree>

(@ Either part" *a" ter*iate this a'ree*et at 9ill# 9ithor 9ithout cause# at a" ti*e upo otice to the other.

6 the case at bar# the ter*iatio clause o: theSupervisors A'ree*et clearl" provi4es :or t9o 9a"s oter*iati' a4Qor caceli' the cotract. Oe *o4e4oes ot exclu4e the other. &he cotract provi4e4 that ica be ter*iate4 or cacelle4 :or cause# it also state4that it ca be ter*iate4 9ithout cause# both at a" ti*e



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a4 a:ter 9ritte otice. &hus# 9hether or ot theter*iatio or cacellatio o: the SupervisorsA'ree*et 9as :or cause#I is i**aterial. &he ol"reuire*et is that o: otice to the other part". Fhepetitioer Avo chose to ter*iate the cotract# :orcause# respo4et ua 9as 4ul" oti:ie4 thereo:.

Forth stressi' is that the ri'ht to uilaterall" ter*iate

or cacel the Supervisors A'ree*et 9ith or 9ithoutcause is euall" available to respo4et ua# subDect tothe sa*e otice reuire*et. Obviousl"# o a4vata'eis tae a'aist each other b" the cotracti' parties.

PILIPINO TELEPHONE CORPORATION "S% TECSON' 7$ 2004

!ACTS*

Mr. &ecso applie4 :or six cellular phoesubscriptios 9ith Pilipio &elephoe Corporatio

=P6&E@. &he applicatios 9ere approve4 a4 covere4b" six *obilie service a'ree*ets# all o: 9hichprovi4es> -eue o: all suits arisi' :ro* this A'ree*eor a" other suit 4irectl" or i4irectl" arisi' :ro* therelatioship bet9ee P6&E a4 subscriber shall be ithe proper courts o: Maati# Metro Maila. Subscribehereb" expressl" 9aives a" other veues.I

Mr. &ecso :ile4 9ith the R&C# 6li'a Cit"# aaoel orte# a co*plait a'aist petitioer :or a Su* o:



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Moe" a4 a*a'es.I P6&E *ove4 :or the 4is*issalo: the co*plait o the 'rou4 o: i*proper veue.

ISSUE*

Fhether or ot the co*plait 9as :ile4 i the9ro' veue

HELD*

Sectio %# Rule %# o: the Revise4 Rules o: CivilProce4ure allo9s the parties to a'ree a4 stipulate i

9riti'# be:ore the :ili' o: a actio# o the exclusiveveue o: a" liti'atio bet9ee the*. Such aa'ree*et 9oul4 be vali4 a4 bi4i' provi4e4 that thestipulatio o the chose veue is exclusive i ature ori itet# that it is expresse4 i 9riti' b" the partiesthereto# a4 that it is etere4 ito be:ore the :ili' o: thesuit.

&he provisio cotaie4 i para'raph 22 o: theMobile Service A'ree*et#I a sta4ar4 cotract *a4eout b" petitioer P6&E to its subscribers# apparetl"accepte4 a4 si'e4 b" respo4et# states that theveue o: all suits arisi' :ro* the a'ree*et# or a"other suit 4irectl" or i4irectl" arisi' :ro* therelatioship bet9ee P6&E a4 subscriber# shall be ithe proper courts o: Maati# Metro Maila.I &he a44e4stipulatio that the subscriber expressl" 9aives a"other veueI shoul4 i4icate# clearl" eou'h# the iteto: the parties to cosi4er the veue stipulatio as bei'preclusive i character.

PHILIPPINE NATIONAL BAN# "S% CAA =1@ 32J!ul" 1/)%TL =2@ %1J Octobe1/)%TL a4 =3@ %)J ove*ber 1/)%T# or 3 ti*es 9ithithe spa o: a si'le"ear.



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&his 9as 4oe 4espite the u*erous letters o:reuest *a4e b" PR that the iterest rate beicrease4ol" to 21J or 2%J.PR :ile4 a co*plait a'aistPetitioer 9ith the R&C. &he latter 4is*isse4 the case:or lac o: *erit. Appeal b" PR to CA resulte4 i his:avor. 8ece the petitio :or certiorari u4er Rule %5 o:ROC :ile4 b"P0 9ith SC.

ISSUE*

espite the re*oval o: the sur" a9 ceili' oiterest# *a" the ba vali4l" icrease the stipulate4iterest rate o loas cotracte4 9ith thir4 persos aso:te as ecessar" a4 a'aist the protest o: suchpersos

HELD*

O. Althou'h u4er Sec. 2 o: P 11(# the

Moetar" 0oar4 is authori,e4 to prescribe the *axi*u*rate o: iterest :or loas a4 to cha'e such rates9heever 9arrate4 b" prevaili' ecoo*ic a4 socialco4itios# b" express provisio# it *a" ot 4o soo:teer tha oce ever" 12 *othsI. 6: the Moetar"0oar4 caot# *uch less ca P0# e::ect icreases othe iterest rates *ore tha oce a "ear. 0ase4 o thecre4it a'ree*et a4 pro*issor" otes execute4bet9ee the parties# althou'h PR 4i4 a'ree to icreaseo the iterest rates allo9e4 b" la9# o la9 9as passe4

9arrati' Petitioer to e::ect icrease o the iterestrates o the existi' loa o: PR :or the *oths o: !ul" toove*ber o: 1/)%.either there bei' a" 4ocu*etexecute4 a4 4elivere4 b" PR to e::ect such icrease.

or escalatio clauses to be vali4 a4 9arratthe icrease o: the iterest rates o loas# there *ustbe>=1@ icrease 9as *a4e b" la9 or b" the Moetar"0oar4L =2@ stipulatio *ust iclu4e a clause :or there4uctio o: the stipulate4 iterest rate i the evet thatthe *axi*u* iterest is lo9ere4 b" la9 or b" theMoetar" boar4.

6 this case# P0 *erel" relie4 o its o9 0oar4Resolutios# 9hich are ot la9s or resolutios o: theMoetar" 0oar4. espite the suspesio o: the sur"a9# i*posi' a ceili' o iterest rates# this 4oes ot

authori,e bas to uilaterall" a4 successivel" icreaseiterest rates i violatio o: Sec. 2 P 11(.6creasesuilaterall" e::ecte4 b" P0 9as i violatio o: theMutualit" o: Cotracts u4er Art. 13$). &his provi4esthat the vali4it" a4 co*pliace o: the parties to thecotract caot be le:t to the 9ill o: oe o: thecotracti' parties. 6creases *a4e are there:ore voi4.6crease o the stipulate4 iterest rates *a4e b" P0also cotravees Art. 1/5(. 6t provi4es that# o iterestshall be 4ue uless it has bee expressl" stipulate4 i

9riti'I. PR ever a'ree4 i 9riti' to pa" iterest

i*pose4 b" P0 i excess o: 2%J per au*. 6terestrate i*pose4 b" P0# as correctl" :ou4 b" CA# isi4ubitabl" excessive.

D#C HOLDINGS CORPORATION "S% CAA


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"ear perio4# petitioer shall serve :or*al 9ritte oticeupo the lessor Ecaracio 0artolo*e o: its 4esire toexercise its optio. &he cotract also provi4e4 that icase petitioer chose to lease the propert"# it *a" taeactual possessio o: the pre*ises. 6 such a evet# thelease shall be :or a perio4 o: six "ears# ree9able :oraother six "ears# a4 the *othl" retal :ee shall beP15#$$$.$$ :or the :irst six "ears a4 P1)#$$$.$$ :or the

ext six "ears# i case o: ree9al.

Petitioer re'ularl" pai4 the *othl" retalprovi4e4 :or b" the Cotract to Ecaracio util her4eath i !auar" 1//$. &her

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